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World Bank Supports Stability in Mozambique

World Bank Supports Mozambique to Improve Financial ServicesOn Sept. 29, 2015, the Government of Mozambique (GoM)’s Financial Sector Development Strategy got the support of a U.S. $25 million credit from the World Bank.

Funneled through the World Bank Programmatic Financial Sector Development Policy Operation (DPO), this support aims at promoting greater financial inclusion and market stability in Mozambique, which also helps develop business and alleviate poverty.

In order to reinforce financial stability, the World Bank Programmatic Financial Sector Development Policy Operation (DPO) supports improvements in the bank’s regulations and supervision, safety net and crisis preparedness frameworks.

The operation supports reforms to promote financial inclusion by focusing on improving credit reporting systems, branchless banking and mobile banking, consumer protection, payment systems and insolvency frameworks

Moreover, by supporting reforms in capital markets and expanding the insurance and pension coverage, the operation helps promote long-term financial markets.

According to the World Bank, if effectively regulated and supervised, improved financial services would spur economic growth, reduce income inequality and help lift households out of poverty.

Through the funding program, DPO directly supports the GoM’s Financial Sector Development Strategy to broaden financial inclusion, enhance banking regulation and supervision, strengthen the banking safety net and crisis management framework and improve government securities markets.

“This DPO series has three main objectives: increase financial inclusion, improve financial stability, and strengthen long term financial markets in Mozambique,” said Mark R. Lundell, World Bank country director for Mozambique.

Mazen Bouri, the World Bank co-Task team leader for the DPO, said, “The GoM recognizes the importance of financial services development to reduce poverty and improve the business environment.”

In line with the World Bank Group’s Country Partnership Strategy for Mozambique (2012-2015), this program is dedicated to the twin goals of eradicating absolute poverty and improving shared prosperity in the world.

Shengyu Wang

Sources: World Bank 1, World Bank 2, World Bank 3, First Initiative
Photo: Pixabay