MOBILE Banking is one of the best modes of providing financial services, particularly in remote areas since it is cost effective compared to the traditional banking services.
This was said by the Deputy Minister for Finance, Ms Janet Mbene, at the National Assembly here that most banks shun rural areas due to high operating costs and limited business opportunities. She urged the public, particularly in rural areas where banking services are limited, to resort to mobile banking services provided by mobile phone operators in the country.
She reasoned that it is easy to operate mobile banking services compared to cost of establishing new banks and branches in rural areas or installing Automated Teller Machines (ATMs). Ms Mbene made the remarks in response to a question posed by Special Seats MP, Ms Diana Chilolo, who had challenged the government to persuade banks operating in the country to open branches at Shelui Township in Singida region.
The MP had complained that currently residents in the area access banking services at Kiomboi Township, almost 25 kilometres from Shelui. In response, Ms Mbene said the government is not responsible for directing banks on where to put up branches and ATMs but rather puts in place favourable business climates to enable the banks operate.
"Banks take in several considerations before putting up ATMs such as security, money circulation, business opportunities, population as well as cost of operation among others," Ms Mbene said. According to the Deputy Minister, the cost for putting up ATMs range between 40m/- and 65m/- depending on the type and quality of the respective machine.