Namibia is set to introduce an Instant Payment Solution that will transform financial transactions in the country, particularly for those living in rural and peri-urban areas, Bank of Namibia Governor Johannes !Gawaxab has said.
The new system according to BoN, promises to eliminate the need for costly travel and intermediaries typically faced by these communities when accessing financial services and by enabling secure and instant transactions, the Instant Payment Solution empowers rural populations and fosters greater financial inclusion.
“In line with its Strategic Plan, the Bank of Namibia remains committed to driving digital and financial inclusion across all sectors of Namibian society,” !Gawaxab stated during his address to stakeholders at the 5th edition of the Cirrus Investor Conference at Swakopmund.
The Central Bank initiated a tender last year to engage reputable companies for designing and operating the system over a five-year period.
!Gawaxab emphasised the significance of initiatives such as the Central Securities Depository (CSD) Project and the exploration of Central Bank Digital Currencies (CBDCs) in modernising the financial landscape and promoting inclusivity. Additionally, he highlighted Namibia’s role within the Common Monetary Area (CMA) countries in exploring CBDCs for enhancing cross-border payments.
Addressing concerns regarding international standards compliance, Governor !Gawaxab reaffirmed the Bank’s commitment to safeguarding the financial system, despite Namibia’s recent grey-listing by the Financial Action Task Force (FATF).
“The unprecedented challenges and untapped opportunities we face demand a novel approach,” !Gawaxab emphasised, stressing the need for innovative solutions to benefit both businesses and the nation.
Furthermore, !Gawaxab discussed challenges related to inflation, emphasising the importance of maintaining price stability. He provided insights into Namibia’s inflationary trends and projected economic performance, highlighting the resilience of the financial system amidst the challenges posed by the Covid-19 pandemic.
“Despite the challenges posed by the Covid-19 pandemic, Namibia’s financial system has demonstrated resilience, remaining stable and sound. The banking sector has sustained solid profitability and robust capitalisation. Looking ahead, the Namibian economy is projected to experience a modest slowdown in 2024 before rebounding in 2025, driven primarily by the Agriculture and Mining sectors.”
Reflecting on the Central Bank’s performance, !Gawaxab noted robust financial performance amidst a high-interest-rate environment, resulting in the declaration of a dividend exceeding N$500 million to the State.
