•  The implementation of the Banking Supervision Application Project, aimed at supporting banking supervision and providing a framework for supervision with the view of having a safer financial sector. Distinguished Ladies and Gentlemen, in order to promote greater access by the population to banking and financial services, the following have been implemented: •  Establishment of an automated electronic clearing house in 1999 (to speed up processing cheques from 4-10 days for local and country checks to 2-5 days, respectively), enhancing the security of cheques and introducing machine-readable cheques. •  Establishment of a direct debt and credit clearing system (DDACC) and a realtime gross settlement system (RTGS) called Zambian Interbank Payment and Settlement System (ZIPSS) in October 2001 and June 2004, respectively. The DDACC system has facilitated the transfer of money by electronic means for payment of bills and salaries while RTGS allows a speedy, safer and large value clearing facility. Commercial banks have also set up a foreign currency cheque clearing system. •  The adoption of the Financial Sector Development Plan (FSDP). This is a framework which aims to promote the development of a stable, sound and market-based financial system that would support efficient resource mobilisation necessary for economic diversification, sustainable growth and poverty reduction. Currently, key recommendations of the FSDP are under implementation. For example, the creation of a Credit Reference Bureau will improve the information available to credit providers in order to enable them to make better credit decisions.

NATSAVE was set up to administer savings and to provide credit facilities in urban, periurban and rural areas to individuals and small business enterprises. Its business strategy is to target the low and medium income earners through the establishment of a sustainable network of outlets and by offering sustainable financial services. The Bank has continued to be a leading public vehicle in ensuring financial inclusion to all citizens across the country through the vast branch network. Currently, NATSAVE has 27 branches (including Lukulu branch), spread across the country. 4. Honourable Ministers and Distinguished invited guests, a key element in the strategy of poverty reduction is the provision of financial services to the majority of our people, the small and micro enterprises who have traditionally been neglected by the formal banking sector. NATSAVE’s expansion program therefore has the potential to improve access to financial services and enhance competition in the financial sector. This improves financial services delivery to the Zambian people and brings more of the financially excluded population to the financial institutions. The Bank of Zambia views this development positively, particularly as recent trends indicate that many institutions in the financial sector are extending their branch networks. 5. However, it is important for financial service providers to complement branch expansion with increased product innovation. The ability to offer a broad range of products and services is the hallmark of financial sector deepening, as different types of products appeal to a wider range of clients, leading to enhanced access to financial services.