Inter-bank transfers plunged 6.5% between April and June

Latest national payment systems report shows a decline of interbank transfers and settlement methods in first quarter.

It says the total volume of transactions processed in quarter one, decreased by 8.9 percent to 1.8 million dealings compared to the fourth quarter of 2022.

The report by the Reserve Bank of Malawi – RBM states that the decrease was primarily due to a reduction in large value interbank transactions, Electronic Funds Transfers and cheques.

It also acknowledged that payments landscape was impacted by several factors, including Cyclone Freddy, depreciation of the local currency against major currencies and inflation increase.

“As a result, the overall volume of transactions processed in all payment channels decreased by 6.5 percent to 292.7 million in the first quarter of 2023.

“However, compared to the same period in 2022, transactions have surged by 32.7 percent.

“Further, during the first quarter of 2023, the total value of transactions significantly increased by 26 percent to K34.6 trillion, a staggering increase of 92.5 percent compared to the same period in 2022,” it said.

The large value interbank transactions contributed to the increase in the worth of dealings, leading to an increase in the average transaction value from K11.4 million to K16.6 million.

Thus, the value of transactions significantly increased by 101.8 percent compared to the first quarter of 2022, amounting to K30.6 trillion.

Meanwhile, cheque usage has maintained a downward trend declining by 6.3 percent in volume and 4.6 percent in value.

This drop is positive according to analysts who have been advocating for mindset change towards online dealings to grow the digital economy.