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BoM: “Five Financial Institutions Face Penalties for Breach of Customer Rights in 2023”

BoM: “Five Financial Institutions Face Penalties for Breach of Customer Rights in 2023”

The Bank of Mozambique (BoM), the regulator of the country’s financial system, penalised five financial institutions in 2023, resulting in fines of more than 46 million meticals. The figures were revealed last Friday (22) by the institution’s governor, Rogério Zandamela, during the opening of the academic year at Zambezi University (UniZambeze), in the city of Beira, Sofala province.

According to the source, quoted by Carta de Moçambique news portal, the penalisation of the banks (whose names he did not reveal) was due to the violation of customers’ rights, including unanswered complaints, the provision of unreliable financial information, misleading advertising, among others.

The BoM official explained that the penalisations took place in the field of consumer protection and financial education, a measure taken as part of the National Financial Inclusion Strategy, approved in 2016 and in force until 2022, as part of the government’s strategy for the development of the financial sector.

In addition to consumer protection with the introduction of severe penalties, Rogério Zandamela reported that, within the scope of the aforementioned Financial Inclusion Strategy, the basic bank account was introduced into the national banking system, i.e. a special current deposit account with simplified identification requirements for its opening, which aims to allow needy families to have bank accounts under more flexible conditions.

The BoM governor also mentioned the creation of the figure of banking agents and non-banking agents, which allows for a greater expansion of financial services, with a greater focus on the country’s most remote areas, where there is no physical presence of banks.

“In recognition of the central and revolutionary role of financial technologies in financial inclusion and taking advantage of the advancement of technologies, the Regulatory Sandbox was launched in 2018, an initiative aimed at increasing the supply of digital service providers in the economy in a safe and competitive manner. This is how, with the permanent monitoring of the Bank of Mozambique, it was possible to test and approve 17 financial products/services developed by fintechs and startups in the Regulatory Sandbox, which facilitated their licensing process because they were monitored by the regulator,” the source recalled.

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In terms of strengthening the financial infrastructure, the governor of the central bank pointed to significant advances, such as the implementation of interoperability between electronic money institutions and banks, the implementation of the Central Registry of Securities Guarantees by credit institutions operating in the country and the introduction of contactless technology, in line with good international practice.

“As a result of these reforms, Mozambique is increasingly improving its levels of financial inclusion. Today, every district in the country has at least one point of access to financial services, a third of the population has access to banking services and 93 per cent of the population has access to the services of electronic money institutions. Nationwide, we have more than 90,000 e-money accounts per 100,000 adults. In addition, more than 1,250 e-money agents are in operation for every 100,000 adults,” said Rogério Zandamela.

As a result of interoperability, the BoM governor also reported that transactions had increased significantly between 2022 and 2023, with transfers from banks to e-money institutions rising from 61,000 to 888,000 transactions, as well as transfers between e-money institutions, from 17.7 million to 74.7 million operations.

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