More than 75percent of Zimbabweans live on less than $200 a month


At least 76 percent of Zimbabwe’s 7 million adult population is living on less than $200 a month, according to a consumer survey conducted by the country’s official statistics agency and a regional independent research house, showing worsening socio-economic conditions over the past four years.

The FinScope Consumer Survey 2014, commissioned by FinMak, a South Africa-based entity which seeks to improve financial inclusion, was conducted by the Zimbabwe National Statistics Agency (ZIMSTAT), which handled sampling, quality control and weighting of data, and Continental – Fonkom, which conducted 4 000 face-to-face interviews.

The research, the second after FinScope 2011, was conducted between July and September 2014.

The meagre personal income numbers dovetail with recent World Bank figures which show that real per capita incomes in Zimbabwe are lower today than they were 55 years ago in 1960, further denting the country’s prospects as a viable investment destination due to lack of sizeable markets, among other factors deterring foreign direct investment.

The survey also threw up a set of bleak poverty indicators – access to water has declined, with only 29 percent having piped running water, compared with 35 percent in 2011 and 36 percent being unable to send children to school due to lack of school fees, up from 25 percent in 2011.

The percentage of people who have had to skip a meal due to lack of money went up to 44 percent in 2014, from 29 percent four years ago, while 37 percent have gone without treatment or medicine because of lack of money, compared with 20 percent in 2011.

“Adults with no income have decreased, although the majority earn $100 or less,” said FinMark project manager, Obert Maposa today.

The survey also found that 70 percent of adult Zimbabweans reside in the rural areas, a 5 percentage point increase from the 2011 figure, pointing to a decline in the urban population.

There were some positives – such improvements in education as shown by the decrease in the number of people with no education from 7 percent in 2011 to 3 percent in 2014. Financial inclusion also increased by 17 percentage points, from 60 percent in 2011 to 77 percent in 2014 – largely driven by mobile money products by the telecommunications sector.

The number of Zimbabweans with an insurance policy remained static at 30 percent, with funeral cover and medical aid being the major products taken out to cover risk. The survey also found that 53 percent of Zimbabweans did not save in 2014, compared with only 37 percent in 2011.

The study also revealed that at least 30 percent or 2.08 million of the population were operating bank accounts last year compared to 24 percent (1.45 million) in 2011 as many people shunned banks while others could not afford the charges.

“Despite these improvements, more hardships were experienced in 2014 compared to 2011 due to a lack of money in this regard,” said FinMark.

According to the study, more people were accessing banking services last year compared to 2011, although the figure is still way below intended levels.

“Banking in Zimbabwe is largely driven by the use of transactional products. A high percentage of the population (70 percent) is not banked with the majority of those indicating that they do not need a bank account (74 percent),” the firm said.

Other reasons cited by individuals for not having a bank account were that they cannot afford to maintain a minimum balance required; bank charges were too high and many received income in the form of cash and therefore had an insufficient balance for a bank account.

Of those who have a bank account, 67 percent regarded safety as a main reason for banking while 39 percent used bank accounts as a means to either deposit or receive money from an employer. At least 20 percent of those who are banked said it was an easy way to obtain loans.

The survey further revealed that 53 percent of adult Zimbabweans do not save with the majority claiming not to have sufficient funds after paying for living expenses while others did not have an income.

“Of the 47 percent of adults who currently save, 35 percent save to cover living expenses while 21 percent do so for education and school fees. Only 19 percent save for non-medical emergencies.”

The study further showed that 58 percent of adults do not borrow for fear of debt while others were concerned about defaulting on credit.

At least 70 percent of adults did not have insurance with most respondents claiming that insurance was “too expensive”. Of those who have insurance, 77 percent was for funeral cover and 30 percent medical aid.

The study also revealed that many people were now using mobile money remittance services. At least 58 percent of those who remit, 83 percent said they used formal channels such as the bank, mobile money and cross-border channels like Mukuru, MoneyGram and Western Union.- The Source


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Charles Rukuni
The Insider is a political and business bulletin about Zimbabwe, edited by Charles Rukuni. Founded in 1990, it was a printed 12-page subscription only newsletter until 2003 when Zimbabwe's hyper-inflation made it impossible to continue printing.


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