Tuesday, July 23, 2024

Only 4% Afghans have proper access to banking system

Immigration News

Afghan bankers on Tuesday said only 4% of the Afghan citizens have access to banking system in Afghanistan due various issues which prevents them from better access to state and private banks.

Afghanistan is currently served by 14 private and 3 state banks which are having 800 branches across the country.

Officials of the Afghan banks on Tuesday following a two days exhibition assessed the options on how to improve banking system and reduce the current challenges.

The total values of the Afghan banks are around $5 billion which is comprised of the private and state bank customers deposits.

Chief of the Afghan Banks Association Khalil Sediq said they are having various issues and barriers regarding the proper usage of the banks liquidity to investors.

He said, “Only 4% of the Afghans might have access to banks and it seems that the investors are also not having proper access to banking systems due to various issues.”

In the meantime Afghan finance minister Omer Zakhilwal said huge investments have been put in place in Afghan banks however lack of confidence is the main barrier towards the investors in the country.

He said, “It is important to understand on how to use the cash deposits in the banks. Everyone has a chance and it is vital to take necessary steps in order to prevent the risk of loss of money and the banks are also keen to be safe in this regard.”

Mr. Zakhilwal also said, “Banks are charging interests but they are not ready to accept risks. The main question in this exhibition is to find out ways on how to reduce these risks.”

In the meantime growth of banking system in Afghanistan is considered to be one of the major achievements in Afghanistan during the past ten years however there are also objections in this regard including the static position of the deposits in the banks and lack of investment opportunities for the banks.

Anwar-ul-Haq Ahadi Afghan trade and commerce minister said the banks are not capable of offering large loans and none of the banks are having over $100 million capital.

He said majority of the capital of the banks are camprised of the customes deposits and most of the banks are hardly having capital of around $20 million.

Ahadi said, “Based on the law the banks are not allowed to offer more than 15% of their capital as loan and therefore the banks are not capable of meeting the requirements of the investors.”

On the other hand lack of proper supervision over the banking system in Afghanistan is a major issue which led to the collapse of a major bank in Afghanistan two years ago.

Kabul Bank collapsed two years back which was later taken over by the Afghan government however the issues of the bank have not been properly resolved.

Meanwhile Afghan government announced to approve the mortgage law in the country shortly which will boost the banking sector in Afghanistan.

- Advertisement -

More articles


Please enter your comment!
Please enter your name here
Captcha verification failed!
CAPTCHA user score failed. Please contact us!

- Advertisement -

The World News