Many Namibians still keep cash 'under the mattress'
Only 67% of Namibian adults had a bank account in 2017
People keep cash on hand for a variety of reasons, Kambala said, adding that Namibians may regard it as a safer alternative to saving in a bank, for example.
Despite an increase in digital financial options such as cellphone banking and e-wallet services, many Namibians still prefer to keep their cash under the mattress.
According to an article released by Old Mutual Namibia, citing the World Bank, about 67% of Namibian adults held a bank account in 2017, indicating that a sizable portion of the population lacks access to banking services.
The article - written by Elsie Kambala, chief operating officer and head of unit trusts - said "compared to 47% in 2021, a significant 30% of Namibians choose to keep their savings in cash at home, or as the saying goes, ‘under the mattress’".
"Interestingly, convenience remains the primary reason for unbanked cash savings, with a sizable section of the population still relying on cash savings,” it read.
"These figures mirror a broader trend in financial behaviour, indicating a gradual transition towards formal banking. This includes avoiding banking fees and having easy access to funds. Typically, people hold small percentages of the overall funds at home,” Kambala noted.
Safer alternative
She said people keep cash on hand for a variety of reasons, adding that Namibians save this way as it is regarded as a safer alternative than subjecting their hard-earned dollars to fees. She added that many have limited disposable income in the current economic climate.
Kambala noted that in order to pay for transportation, groceries, airtime and other necessities, many Namibians require cash on a daily basis as using cash instead of other options is more convenient.
“In Namibia, informal traders and low-income workers frequently rely on cash because they do not have bank accounts or because banking services are expensive. Having cash on hand has many benefits, including being accessible in an emergency when electronics or automated teller machines may not be working. Additionally, cash allows for immediate use without requiring electronic transactions. Cash is still an essential component of daily life for many Namibians, particularly those without access to bank cards or online banking services. This is especially true for the vast majority of cash-based informal traders. For many people in Namibia, switching to electronic channels will take time,” she noted.
According to Bank of Namibia statistics, cash is still crucial. Commercial banks received N$10 billion in banknotes in 2023. The volume of coins issued increased from N$14 million in 2022 to N$18 million in 2023, reflecting the consistent need for cash.
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According to an article released by Old Mutual Namibia, citing the World Bank, about 67% of Namibian adults held a bank account in 2017, indicating that a sizable portion of the population lacks access to banking services.
The article - written by Elsie Kambala, chief operating officer and head of unit trusts - said "compared to 47% in 2021, a significant 30% of Namibians choose to keep their savings in cash at home, or as the saying goes, ‘under the mattress’".
"Interestingly, convenience remains the primary reason for unbanked cash savings, with a sizable section of the population still relying on cash savings,” it read.
"These figures mirror a broader trend in financial behaviour, indicating a gradual transition towards formal banking. This includes avoiding banking fees and having easy access to funds. Typically, people hold small percentages of the overall funds at home,” Kambala noted.
Safer alternative
She said people keep cash on hand for a variety of reasons, adding that Namibians save this way as it is regarded as a safer alternative than subjecting their hard-earned dollars to fees. She added that many have limited disposable income in the current economic climate.
Kambala noted that in order to pay for transportation, groceries, airtime and other necessities, many Namibians require cash on a daily basis as using cash instead of other options is more convenient.
“In Namibia, informal traders and low-income workers frequently rely on cash because they do not have bank accounts or because banking services are expensive. Having cash on hand has many benefits, including being accessible in an emergency when electronics or automated teller machines may not be working. Additionally, cash allows for immediate use without requiring electronic transactions. Cash is still an essential component of daily life for many Namibians, particularly those without access to bank cards or online banking services. This is especially true for the vast majority of cash-based informal traders. For many people in Namibia, switching to electronic channels will take time,” she noted.
According to Bank of Namibia statistics, cash is still crucial. Commercial banks received N$10 billion in banknotes in 2023. The volume of coins issued increased from N$14 million in 2022 to N$18 million in 2023, reflecting the consistent need for cash.
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