there has been a notable change in consumer behavior. consumers use credit cards for two purposes : ( i ) as a substitute for cash and cheques, and ( ii ) as a source of revolving credit. therefore my concern is whether the consumer fully understands the costs and implications of using credit cards and whether credit cards are encouraging over - indebtedness, particularly for those least able to pay? in the us, for example, many households have thus been caught in the so - called “ plastic trap ” – consumers do not seem to be able to repay their balance, especially those who opt to pay only the minimum repayment amount by the due date of each month. in mauritius, credit card advances currently represent around 3 per cent of total household credit. concurrently, credit to the household sector by banks has been growing at a faster pace than nominal gdp ( although the credit was mainly for property acquisition, generally viewed as a low risk investment. ) as a regulator we need to remain vigilant and keep an eye on the delinquency rate of credit cards. and so should you for the health of your loan portfolio. my second concern which of course is more in the nature of an inducement, not a concern, for you is that card business is very good business. financial institutions that are in the card business know that they make very good money from card - related fees. since credit cards are unsecured in nature, interest rates on credit cards are very high – around 2 per cent monthly. there are also fees for late payments, fees for cash withdrawal, and other penalties, on top of the hidden “ swipe fees ” that banks and credit card companies collect each time a customer pays with his credit card. unfortunately, most of the time, such costs are passed on to the customer. and i can tell you, time and again we receive complaints from the public that credit card fees are prohibitive. in the us there is what i call the battle of the swipe fees raging on. the senate passed an amendment directing the federal reserve to reduce “ swipe fees ” ( on debit cards ) and to limit them to the “ reasonable and proportional ” cost of each transaction. you can imagine the intense lobbying from banks to push for changes, or outright repeal of such a legal requirement, arguing that they are being deprived of a significant source of revenue and that they would be forced to trim down on some of their services to recoup the loss. on the other

njuguna ndung ’ u : the africa mobile phone financial services policy initiative ( ampi ) opening remarks by prof njuguna ndung ’ u, governor of the central bank of kenya, at the inaugural african roundtable meeting to launch the “ africa mobile phone financial services policy initiative ( ampi ) ”, co - hosted by the bank of tanzania, alliance for financial inclusion ( afi ) and central bank of kenya, zanzibar, tanzania, 14 – 15 february 2013. * * * professor benno ndulu, governor, bank of tanzania ; alfred hannig, executive director, alliance for financial inclusion ; professor mwangi kimenyi, director, african growth initiative, brookings institution ; distinguished guests and colleagues ; ladies and gentlemen : on behalf of the co - hosts, bank of tanzania, alliance for financial inclusion ( afi ) and central bank of kenya, it is my honour to extend a warm welcome to all of you to zanzibar, tanzania to participate in the “ inaugural leaders roundtable meeting to launch the africa mobile phone financial services policy initiative ( ampi ). ” it is indeed encouraging to note that the efforts by all the pertinent players to make this launch a success are being realized today. the fact that you have all graced this occasion demonstrates our commitment as afi members and the passion we have to move financial inclusion to higher levels in our continent and the entire world. i take this opportunity, therefore, to applaud you for your unending passion towards this initiative. ladies and gentlemen, as you may recall, the idea to have a focused regional initiative on mobile phone financial services ( mfs ) platform in africa, was initiated right here in zanzibar during the first african financial inclusion policy forum held in march 2012. this was following discussions held at brookings institution, washington d. c, on the importance of spurring mfs in africa and after a critical analysis of the hurdles that limit the scaling up of mfs in africa. it was further emphasised during the 4th annual afi global policy forum ( gpf ), held in cape town, south africa in september 2012 where we, the african afi members, agreed to organize this inaugural african leaders ’ roundtable meeting. as afi members, our major objective is to extend financial inclusion to the continent ’ s large unbanked populace. we recognise that there is significant potential in the development of mobile phone financial services in africa to accomplish this. ampi, therefore