Awards

Shortlisted at the PayTech Awards 2024
Best Contribution to Economic Mobility In Payments category

Shortlisted at the PAY360 Awards 2023
Best Financial Inclusion Payments Initative category

Background

Centenary Bank is a commercial bank that offers refugees banking products and functions such as fixed deposits, savings and transactional accounts, access to ATMs, agency banking, money transfers, financial literacy and foreign exchange transactions. Working with branches in Blantyre, Lilongwe, Mzuzu, Zomba, Mangochi, Kasungu, Madisi and the Dzaleka agency, in line with its vision of financial inclusion and innovating banking.

CAB and Centenary Bank share many values and possess a common mission to address the challenges of unbanked and underserved communities in deep rural locations. By making financial services accessible and affordable to those who may otherwise be excluded from the financial system, CAB helps to strengthen local economies, deliver social impact, and drive financial inclusion.

Challenge

Refugees around the world are mostly excluded from accessing financial services, with limited to no access to banking facilities. Due to being displaced, they are people who do not exist according to the global financial system.

Located in the central region district of Dowa in Malawi, 21 miles from Lilongwe, is the Dzaleka camp which houses refugees and asylum seekers fleeing from war and genocide from neighbouring countries. Established in 1994, the camp now houses 49,000 people – four times more than its initial capacity from countries such as Burundi, Rwanda, Ethiopia, Somalia and the Democratic Republic of the Congo.

In order to access financial services, refugees were required to travel to the capital city or visit the Dowa trading centre in town. With numbers continuing to increase in the camp, Centenary Bank was approached by a multi-lateral organisation to help get funds to beneficiaries. They explored ways in which they could connect this vulnerable community to crucial financial services.

Solution

Centenary Bank Limited in Malawi partnered with CAB due to its strong relationships, extensive settlement network and long commitment to providing banking services to local banks in Africa and connecting them to the global financial infrastructure. Working with Centenary Bank, CAB was best positioned to offer correspondent banking services by providing USD clearing to help support this vital project. CAB leveraged its partnerships with local and international banks, such as Centenary Bank to help support the delivery of these funds to beneficiaries. Its payment rails and correspondent banking network came into play to make this possible as it had the systems in place which allowed for seamless alignment with other bank systems.

This was the first project of its kind worldwide with a commercial bank extending its banking services to refugees. The agency which was started as a means of fostering financial inclusion towards people in the country, including refugees, has now become a hotspot for financial transactions in the camp extending banking services to those who are most in need.

Every month, the refugees, who are mainly from the Great Lakes region, receive monthly World Food Programme (WFP) cash assistance managed by Centenary Bank. The transfers are in the form of a cash allowance of $5.40 (MK 9,300) per person per month, covering 13,500 households. The camp's current state presents several opportunities that the bank is exploring. One of these opportunities includes group loan disbursements. So far, the bank has disbursed loans worth MK 25 million to four groups, each with ten members.

Other opportunities lie in managing partners' financial businesses. This includes school fee products and cash transfers. On average, 100 new refugees register in the camp each month.

Results

Currently, the branch has 17,420 customer accounts, representing all families in the camp. The customer base includes the host community, of which 1,200 are Malawians. With the establishment of the Dzaleka branch, refugees were given access to bank accounts, whereby they could deposit money earned, build up savings, access funding from humanitarian programmes and receive remittances sent from relatives abroad through Centenary Banks’ partnerships with remittance providers.

The bank has had a big impact on many refugees’ lives. Centenary Managing Director Mrs Zandile Shaba describes how:

“Some have started small businesses while in the camp and the Bank has facilitated their formal savings and in some instances, provided small working capital loans.”

Furthermore, Centenary Banks’ Dzaleka branch has also gone on to employ refugees, assisted others in moving on from the camp travelling onwards and abroad and helped change the story of countless refugees just by having access to basic banking services.

Not only have the refugees’ lives been changed with this access to financial infrastructure, but the branch’s existence in the camp has also impacted the lives of those living in the rural and surrounding areas of Dowa. This has led to the Dzaleka branch of Centenary Bank becoming one of the best performing branches in Malawi demonstrating the need for financial inclusion and how it leads to the betterment of lives when no one is left behind and people are given the opportunity to participate.

Impact

Globally, 1.4 billion people are unbanked, 0.9 billion lack identification and 2.9 billion are unconnected (World Bank figures, February 2023). One group that is particularly vulnerable to financial exclusion is refugees.

CAB is on a mission to reduce these numbers and is transforming the way payments and foreign exchange (FX) move through hard-to-reach markets. CAB believes everybody in society should have access to financial services regardless of their income, savings, or location therefore, its network, technology, and expertise help governments, institutions, and organisations de-risk access and deliver money to underserved geographies. CAB’s ultimate goal is to move money in the most complex situations, to the most challenging markets for organisations that need it most.

By bringing banking services to Dzaleka, this partnership with Centenary Bank has allowed for subsequent partnerships with non-government organisations (NGOs) and multi-lateral organisations in ensuring the delivery of much needed funds to the camp.