Use of Plastic Money in Zimbabwe, Threats and Opportunities for Rural Communities

Misheck Diza, Watson Munyanyi and Linda Gumbo

International Journal of Academic Research in Business and Social Sciences, 2017, vol. 7, issue 6, 354-366

Abstract: Since the Zimbabwean economy adopted the US dollar as a major currency in 2009, rural communities have remained marginalized in terms of access to financial products and services. The research study evaluates the use and adoption of plastic money by rural communities in Zimbabwe. A descriptive research design was adopted to assess the use of plastic money by rural financially active citizens in Masvingo Province. Data was collected from a sample of 300 respondents using a self-administered questionnaire and analyzed using selected econometric computer packages. The research study established that the majority of rural communities in Zimbabwe had no access to plastic money facilities and therefore transacted mainly using cash and mobile money. This was largely due to lack of plastic money facilities among rural service providers, lack of adequate knowledge on importance of plastic money, low income levels and lack of confidence in the overall financial system. It was concluded that very few financial institutions served the rural market, and those that, did relied on agent banking. In addition, the majority of retail operators are importers who only accept cash as a means of settlement. It was recommended that banks should market their products and services to rural markets through awareness campaigns on the benefits to be drawn from adoption and use of plastic money. The central bank through its monitoring and supervisory function should continue to assess the extent to which banks and other financial institutions are serving the needs of rural communities. Point of Sale (POS) transaction costs should be reduced further to allow low income earners to transact even in smaller amounts without feeling the pinch, otherwise the goals of the National Financial Inclusion Strategy will be unachievable by 2020.

Keywords: Plastic Money; Financial Inclusion; Rural Community; Cash; Mobile Money (search for similar items in EconPapers)
Date: 2017
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hrmars.com/hrmars_papers/Use_of_Plastic_Mon ... ural_Communities.pdf (application/pdf)
http://hrmars.com/hrmars_papers/Use_of_Plastic_Mon ... ural_Communities.pdf (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hur:ijarbs:v:7:y:2017:i:6:p:354-366

Access Statistics for this article

More articles in International Journal of Academic Research in Business and Social Sciences from Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences
Bibliographic data for series maintained by Hassan Danial Aslam ().