A SURVEY by the Zambian Financial Sector Deepening Limited (FSD Zambia) has revealed that 25 per cent of Zambian families sold some assets to meet basic needs in September, an increase from 12 per cent recorded in May this year.

According to a statement, the FSD Zambia survey, which was conducted with FinMark Trust (FMT), shows that Zambian families continue to be negatively affected by the Coronavirus pandemic as the number of households selling assets to meet basic needs is going up signalling weakened financial health among households.

“Survey results of a national COVID-19 research tracker of households show that Zambian families continue to be negatively affected by the coronavirus pandemic. Results show that the proportion of households selling assets to meet basic needs is going up, from 12% in May to 25% in September. The FSD Zambia survey was conducted with FinMark Trust (FMT), in four waves of questions to 4,638 households with 51% women respondents. About 55% were in rural areas. The study aimed to assess the medium and long-term impact of COVID-19 on Zambian households, particularly socio-economic, health, behaviour and risk perceptions,” read the statement issued by FSD Zambia communications manager Eneya Phiri.

“The results indicate a failing state of financial health among households as a result of the pandemic, with the situation being much worse for women at 52% compared to men at 42%. Additionally, the number of households missing loan repayments doubled, from 4% in May to 8 % in September. Respondents attributed loan defaults to the increased need for spending on essential commodities. Further, for most households who need to borrow, their primary source of funds is either family, friends or the community. It seems clear that formal borrowing sources are much less available to many Zambians.”

And Phiri stated that FSD Zambia chief executive officer, Betty Wilkinson, expressed concern over the development as the households will face a harder time generating income if they dispose of their assets.

“We are extremely worried about this trend. Families increasingly are selling their basic assets, many of which are used to earn money. Without these items income generation, recovery, and even money for basic survival will be much harder to earn,” Wilkinson said.

Meanwhile, Phiri stated that FSD Zambia had signed a £3 million grant from Sweden to support implementation of the financial inclusion programs for women, youth, and the differently abled.

“FSD Zambia welcomes a GBP3 million grant from Sweden through the Swedish International Development Cooperation Agency (Sida) to support the implementation of the Women and Youth in Financial Inclusion (WIN) Phase II Programme from 2020 to 2025. Building from the learnings, experience and innovations of the WIN Phase I programme that ran from 2016 to 2020, Phase II marks the beginning of a more significant contribution to the systematic and lasting change, particularly benefiting poor women, youth and the differently abled,” stated Phiri.

“With this funding received, and with FSD Zambia’s new approach to financial sector development (FSD 2.0), the WIN Phase II programme will focus on deepening financial inclusion and capabilities for women, youth, people with disabilities and their households. The programme will also aim to reduce vulnerability, increase income opportunities and ultimately improve access to basic services and a sustainable futures for our target clients. Through a market systems development approach to financial inclusion and addressing financial barriers to real sector engagement, the WIN Phase II programme will involve the learning, facilitating and testing of market innovations that will enable stakeholder sustainability and systems to go to scale.”