The Sunday News
Nkosilathi Sibanda, Sunday Business Correspondent
DEPOSIT Protection Corporation chief executive officer Mr Vusilizwe Vuma has been elected vice-chairman of the African Regional Committee (ARC) of the International Association of Deposit Insurers, buttressing the international acclaim that the country’s solid financial and banking policies have received.
He will deputise Kenya Deposit Insurance Corporation’s CEO Mohamud Ahmed Mohamud, in a term that will last three years.
Mr Vuma, who was elected unopposed comes in with the responsibility to oversee the establishment of the African Centre for Studies of Deposit Insurance, as the continent forges to strengthen its banking industry. The centre, to be located in Nigeria, is expected to open later in the year and dovetails with the African Union’s Agenda 2063 of reaching financial inclusivity and confidence in the banking system.
Mr Vuma has been at the helm of the DPC since 2019. In his new role, which commenced at the beginning of March, Mr Vuma is also expected to play a part in the formulation of the development of African countries’ deposit insurance system, in what is considered a boost to the country’s planned economic revival strategy.
According to details sought from IADI, Mr Vuma will as well be in committees that spearhead training and technical assistance, member relations council, strategic planning working group and the capacity building technical committee. Zimbabwe’s representation in the ARC is a testimony to sound banking deposit protection structures that are being created by the DPC which are key in fostering a strong economy underpinned by a well-managed deposit culture.
The country is credited for playing an exemplary role in encouraging member nations of the Southern African Development Community (Sadc) to establish deposit insurance schemes. Since its formation in 2003, the DPC has been instrumental in helping set up deposit insurance schemes in South Africa, Namibia, Eswatini, Zambia and Lesotho.
In accepting the new position, Mr Vuma said his immediate task was to help African countries that were yet to create deposit insurance structures.
“My goal is to convince and assist those African countries that have not set up deposit insurance schemes to do so.
We will help them in terms of capacity building and skills transference. Zimbabwe has been spearheading the establishment of deposit insurance schemes especially within the Sadc region. My goal is to convince and assist those African countries that have not set up deposit insurance schemes to do so. We will help them in terms of capacity building and skills transference.”
Mr Vuma said African countries have to take note that banking institutions across the continent are fast consolidating operations, and as such no country must be left out of the IADI membership.
“We need to drive membership to IADI so that we are able to share knowledge, experience and to deal with cross-border issues. There are banks with regional presence so we need to ensure that we co-ordinate our activities where depositors are concerned. It only makes sense therefore that we encourage all African states to have deposit insurance schemes,” he said.
Mr Vuma said participation in the global forum of deposit insurers will assist Africa to deal with cross-border difficulties faced by depositors.
“There are banks with regional presence so we need to ensure that we co-ordinate our activities where depositors are concerned. It only makes sense therefore that we encourage all African states to have deposit insurance schemes.”
The IADI has regional committees that comprise Africa, Asia Pacific, Caribbean, Eurasia, Europe, Latin America, North America, Middle East and North Africa. These regional committees were created to reflect regional interests and common issues through the sharing and exchange of information and ideas.
Mr Vuma said the regional committees were to advance the objectives of IADI and act in the best interests of the association.
Under his helm, the DPC made a milestone last year in February by opening a branch in Bulawayo, the first office outside Harare. On the occasion of the launch the institution made a bold statement that it was geared in the direction of raising awareness on deposit protection.
Previously, depositors in the southern part of the country had to endure long distances to Harare to get service. So far, the new branch has served as many clients, in particular those who called to inquire on the status of their deposits in banks that were closed due to liquidation.
Finance and Economic Development Minister, Professor Mthuli Ncube, is on record advising the DPC to advance the agenda of financial inclusion as it is critical to achieve inclusive growth that incorporates small businesses. The minister said the deposit protection scheme has come to the aid of ordinary depositors and banks, a situation that also bred confidence within the financial service sector.
