Agent Banking Model

as a Driver of Financial Inclusion in Zimbabwe



Tariro Mavaza, Dauglas Halimani and Farai Dzapasi

Department of Banking and Finance
School of Commerce
Great Zimbabwe University

Masvingo, Zimbabwe




Agency banking has become one of the key drivers in providing financial services to the poor and marginalized section of the society. Agency banking involves financial   institutions using existing retail outlets to extend their services to the financially excluded population. The degree to which the agency banking model can be used as an instrument of promoting financial services remains a subject of debate. The purpose of this study was to explore a possible positive link between Agency banking and Financial Inclusion. An exploratory research design was used in the study given the problem at hand. To reach the intended goal, the researcher looked at other issues that are around the Zimbabwean financial sector such as the drivers of agency banking, its adoption and also part in promoting financial inclusion. The study sums up that agency banking influences financial inclusion in Zimbabwe and specifically Masvingo. The implication of the study is that banks in Zimbabwe should vigorously promote adoption of agency banking model to reach their far and wide customers at minimum cost thereby boosting their performance.

Keywords:  Agency banking, Financial Inclusion, Zimbabwe



Developing countries including Zimbabwe are increasingly embracing branchless banking as a means of delivering banking services to many unreached people especially low-income households. Agency banking model hoped to enhance access to financial services by allowing small businesses to operate as satellite bank branches.  According to the Reserve Bank of Zimbabwe report of 2016 on Financial Access Survey, 39 % Zimbabwe‟s bankable population is still totally out of the financial service orbit. Agent-banking is an arrangement by which licensed institutions engage third parties to offer certain banking services on their behalf. An Agency bank can offer a number of services on behalf of its principal bank such as card-based withdrawals, internal transfers, bill payments, balance inquiries and provision of mini statements. There are a number of reasons why Agency Banking model can be adopted by a bank such as expanding geographic coverage, decongesting branches, targeting new customers, technological advancement and heeding moral suasion of regulators.  Banking agents can be pharmacies, supermarkets, convenience stores, lottery outlets, post offices, and many more.

Today, practically every automobile dealer has a tie-up with a bank or consumer finance institution to provide vehicle loans to their car buyers (www.infosys.com.finacle). In this arrangement the car buyer is able to quickly access financing of the car purchase and avoids the cost and delays of securing a loan through branch banking and the agent (financing partner) has access to a more captive market.

According to Ivantury and Timothy (2006), agency banking could be of benefit to the clients in the following ways; lower transaction cost (Closer to clients home), longer opening hours, shorter lines than in branches, more accessible for illiterates and the very poor who might feel intimidated in branches, to the agency; increased sales from additional foot-traffic, differentiation from other businesses, reputation from affiliation with well-known financial institutions, additional revenue from commissions and incentives, finally to the financial institutions; increased customers base and market share, increased coverage with low-cost solutions in areas with potentially less number and volume of transactions , increased revenue from additional investments, interest and fee income, improved indirect branch productivity by reducing congestion. (Musau and Jagango, 2015)

Latin America is the region with the strongest development towards agency banking with Brazil being probably the most developed market where agency banking has significantly increased financial system structure and virtually 67% of the population now pay at least one bill at an agent. Brazil has the largest agent network in the world having about 400 000 banking   agents.  According to Kiura (2014) in South Africa, the first agency banking was implemented in 2005 and its regulatory framework gives wide discretion to banks to use nonbank third parties to offer banking services beyond traditional branch network.


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How to cite this paper: Mavaza, T.; Halimani, D.; Dzapasi, F.D. (2020). Agent Banking Model as a Driver of Financial Inclusion in Zimbabwe; PM World Journal, Vol. IX, Issue I, January.  Available online at https://pmworldlibrary.net/wp-content/uploads/2020/01/pmwj89-Jan2020-Mavaza-Halimani-Dzapasi-agency-banking-model.docx



About the Authors


Tariro Mavaza

Great Zimbabwe University
Masvingo, Zimbabwe



Tariro Mavaza is a Lecturer in the Munhumutapa School of Commerce, Department of Banking and Finance, the Great Zimbabwe University.  He previously worked for Zimbabwe Revenue Authority as a Revenue Official. His areas of research are: Financial markets, Revenue Collection Systems I, Corporate Governance, Quality Management Systems and Project Management. He has published three research papers in International and Regional Journals on Total Quality Management and Corporate governance. Email address: tmavaza@gzu.ac.zw


Dauglas Halimani

Great Zimbabwe University
Masvingo, Zimbabwe



Dauglas Halimani is 36 years old and a lecturer at Great Zimbabwe University since 2014. He holds a master’s degree in Banking and Financial Services from National University of Science and Technology as well as Bachelor of Commerce Honours in Finance from Great Zimbabwe University. He is a final year Bachelor of Laws student with the University of South Africa. His interests span the areas of commerce and law.  He can be contacted dhalimani@gzu.ac.zw


Farai Dzapasi

Great Zimbabwe University
Masvingo, Zimbabwe



Farai Dzapasi is a lecturer in the Department of Banking and Finance at the Great Zimbabwe University. He holds a Bachelor of Commerce Honours in Finance and Master of Commerce in Finance from Great Zimbabwe University.