The country’s uptake of digital financial services (DFS) in August declined with figures showing that daily average number on automated teller machines (ATMs), Internet banking and point of sale (PoS) transactions dropped.
The figures contained in the National Payment System Report for August 2016 show that ATMs transactions declined by three percent, Internet banking by 4.7 percent and PoS by 1.9 percent.
In a report, the Reserve Bank of Malawi (RBM) noted that the decrease in some of the DFS transactions could be a reflection of economic fundamentals affecting consumer spending during the period.
Along with the development, mobile payment also registered a low active use of the service, which stood at 22.8 percent during the same period.
The regional average for other countries in sub-Saharan Africa was 60.1 percent for active agents and 59 percent for active subscribers as of end 2015.
Reads the report in part: “The slow pace of mobile money penetration in Malawi reflects interplay of several factors such as low consumer awareness, low income levels, physical or technological challenges with connectivity and the relatively lower level of basic mobile phone connections.”
However, in terms of value, the total daily average amount for retail DFS transactions rose by 0.4 percent to K2.6 billion during the same period.
Commenting on the subdued uptake, Consumers Association of Malawi (Cama) executive director John Kapito, while attributing the development to low literacy levels in the country, said commercial banks’ infrastructure is also to blame.
He said: “Oftentimes, we have failed to make digital transactions with either our cell phones or other platforms because of technical problems. It sometimes gets frustrating when you are in need of a quick transaction, but the network is bad.
“We can only ask the central bank and mobile operators to monitor their systems if we are to have an increased uptake of these facilities.”
Bankers Association of Malawi (BAM) executive director Lyness Nkungula earlier said the banking sector is evolving and investing to build infrastructure that can efficiently handle services such as mobile banking.
She said the banking sector realises that the future of banking lies in mobile; hence, investment in mobile technology is much more critical now that ever before.
“Looking at the cost of investing in brick and mortar today compared with the cost of running mobile banking, the cost of managing a full scale bank is prohibitive. n