bwalya k e ng ’ andu : accelerating growth and adoption in mobile payments speech by dr bwalya k e ng ’ andu, deputy governor ( operations ) of the bank of zambia, at the 3rd celpay mobile banking conference, hosted by celpay zambia limited, lusaka, 26 october 2011. * * * the chief executive officer, celpay international bv ; managing director, celpay zambia ltd, mr. miyanda mulambo ; the conference chairperson, mr. maxwell banda ; chief executive officers of commercial banks and financial institutions ; representatives of international organizations ; representatives of zambian business associations ; distinguished participants ; members of the press ; ladies and gentlemen. chairperson, it is my honour and privilege to speak at this, the 3rd mobile banking conference being hosted by celpay zambia limited under the theme “ accelerating growth and adoption in mobile payments ”. the theme of this conference is particularly appropriate as it fits in very well with one major policy objective of the financial sector development plan ; which is to increase access to financial services for the majority of the zambian people. this conference, i believe, will provide a unique opportunity for participants to share ideas and experiences on innovations and trends taking place in the use of the mobile telephone technology as a convenient, safe and cost effective payment system. it should also offer the platform from which to address the challenges that such innovations can present in order to minimize potential disruption to the operations of the financial system that can arise from our failure to appreciate the possible impact of these challenges. i therefore wish to thank, from the outset, celpay for organising this timely conference and to welcome most warmly our foreign participants who i ’ m sure will bring a rare insight to this conference with their own experiences. it is widely acknowledged that expanding access to financial services for zambia ’ s unbanked population remains one of the biggest challenges confronting the financial sector in this country. findings from the last finscope zambia survey which was conducted in 2009 showed that 62. 7 % of zambian adults still remained financially excluded compared to 66. 3 % reported in 2005. this slight increase in access to financial services, however, fails to match the significant increase in the number of banking and non - banking institutions which over the same period increased from 14 to the current 19 banks and to over 90 in the case of the nonbank sector. the mismatch in growth between the supply side and the demand tells us a story that the physical increase in

lower unemployment – on the contrary. the solution is the “ long haul ”, to coin a phrase. the problems were caused by the imprudent economic policies pursued by these countries in the 10 – 15 years leading up to the crisis. they cannot be solved overnight. ireland is an example of how resolute action to address budget and competitiveness problems can shorten the path back to tolerable conditions. the ecb continues its efforts to contain the crisis. the outright monetary transactions programme announced in september entails that the ecb may buy short - term government bonds from debt - ridden eu member states in the secondary market under certain conditions – for example that the eu member state accepts a programme to seriously address its structural problems. following the announcement, 2 - year yields immediately fell in e. g. spain and italy, while they rose in germany. activation of the programme requires an official request from the member state in question. spain has been mentioned as a candidate. turning to greece, we hope that last week ’ s agreement between the euro area finance ministers can restore calm for a while. but the greek debt will be a recurring theme for many years to come. bis central bankers ’ speeches the danish economy is well - balanced, but growth is on a slow track. the current - account surplus is large, and we hold considerable external assets. inflation is moderate, and so is unemployment. in fact, if we disregard the most recent period of overheating, culminating in 2008, we have to go back to the first half of the 1970s, when things also went wrong, to find a lower number of unemployed people than today. experience from the period of overheating has to some extent distorted our concept of normality. but the level of unemployment in that period was not normal, so it cannot be used as a yardstick. if we do that, things will go wrong again. * * * the private sector is consolidating in the wake of the financial crisis. that is understandable, but obviously it is curbing consumption and investment. this trend will cease when savings have reached the desired level – time will show when – and the economy will begin to pick up. the shift could come suddenly – but that is not a promise – especially if the signals from the rest of europe become more positive. the most recent national accounts figures for denmark point to negative growth this year. we estimate that the economy will grow by 1 – 1½ per cent next year compared with