RBM for sound financial system

The recent enactment of financial sector laws that fall under the Financial Services Act 2010 have ensured safety and soundness of financial institutions, Reserve Bank of Malawi (RBM) director for branch management Francis Mabedi has said.

 

 

Speaking in Blantyre on Monday, he said the laws have also brought the highest standards and conduct of business, fairness, efficiency and orderliness in the financial sector.

 

“[The laws] are ensuring stability of the financial system, reducing and deterring financial crime in financial institutions,” said Mabedi at a one-day capital markets workshop for business journalists under the Association of Business Journalists (ABJ).

 

Some of the laws that fall under the umbrella of the Financial Services Act 2010 include the Insurance Act, Pension Act and Financial Cooperatives Act.

 

In a bid to further enhance consumer financial education and protection, Mabedi said the central bank has created a division within the supervision of financial institutions called the consumer education and complaints handling unit.

 

He said the division is in the process of setting up structures on how to effectively educate the public.

 

The unit will be charged with the responsibility of, among others, helping financial consumers to understand their rights and responsibilities when accessing financial services and products, changing the attitude of the public to translate into financial behaviour and actions and increased access to financial services and products, he said.

 

The establishment of the unit comes against the backdrop of complaints from consumers of financial services of poor service delivery, non-disclosure of information and poor financial advice resulting in loss of money.

 

A recent study by Finscope in 2008 found that less that 20 percent of Malawians have access to financial services and products caused, in part, by a lack of necessary financial information.