BANKING ISSUES OF THE NON-URBAN STATE AGENTS OF
ISEA MVUAZI AT KONGO CENTRAL PROVINCE IN DR CONGO
Toussaint B. Kupesa2,
Albert K.M. Lema2, Jean Jules K. Atila4, Odette E.
Anageanatiga1, Antoine K. Mukinga3, Yannick L. Moloba2,
David K. Mfuti12*
1Institut
National pour l’Etude et la Recherche Agronomiques, centre de Mvuazi, DRC BP
2037
2Institut
Supérieur d’Etudes Agronomiques de Mvuazi, DRC
3Cellule
d’analyses des indicateurs de développement (CAID), DRC
4Ministère
de plan, DRC
*
Correspondingauthor: Phone: +243998917770
E-mail:davinkupesa@gmail.com BP.2037 Kin I
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|
ABSTRACT |
Keywords: Banking system; Kongo
Central; ISEA Mvuazi; Bank Agency; Salary; |
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The particular context in which mass banking
was decreed by the Congolese government did no more than to reach the
developing countries threshold estimated roughly at 12%. This is
corresponding to the Kongo central province coverage. The payment of state
agents through bank accounts remains an issue, despite the efforts made by
the government. Currently, the banking system as it is implemented; it is
just a mean of payment in substitution to the public accountants. In urban
centers, access to salary is more and less easy than in rural areas, where
state agents struggle to get their remuneration. Bank coverage across the
country and in the Mbanza ngungu area, in particular, is still disparate.
This is justified following both coefficients of the demographic density of
the banking network and the rate of banking. Publisher All rights reserved. |
INTRODUCTION
The ministerial decree bearing on the creation
of the follow-up committee on the payment of DRC state agents dated on 12th
November 2011. Since
It is
important to note that the initial objective pursued by the DRC government
through the banking system was to master the effective of state agents’
personnel in the governmental system. Therefore, the payment of the state
agents using banking system is being considered by the authorities as a mean to
achieve its above-mentioned goal. We have to keep in mind that those different
choices made by the legislator to improve payment conditions, in the first
instance, aim to contribute on satisfying the need of the entire community. It
is meant that the action engaged publically has to be based on the social
reality perception (Cheffert et al., 1999).
The
challenge of this policy should not only consist in casing the wages of the
agents but rather to reconcile the legal
prescribed of wages payment of the agents in regards to the new professional
socio realities.
Indeed
in Kinshasa, the payment of the state agents has always constituted an
exceptional and insoluble case over years in Democratic Republic of Congo
(DRC), thereafter banking payment of agents has been implemented in provinces
by MOZITO government and continued by the following MATATA government. The
policy instructed by the government seems to meet its affectivity on the extent
of the country even if the issue of banking infrastructures insufficiency
remains real. Banking payment of state agents is an
operation in which payment of agents is conducted through an account number
instead of public accountants.
ISEA-Mvuazi
(InstitutSupérieurd’EtudesAgronomiques de Mvuazi in French) is affiliated to a
bank located at Mbanzangungu. The City is situated nearly at 50 kilometers away
from the Institution creating complex situations beyond those which were posed
formerly. Location of the
payment was not prescribed by the law (worker rules); this is giving state
agents some freedom to go to perceive their salary from the bank or to wait
getting it from their service location as it was done previously. However, the civilian code considers the
salary as a debt contracted by the government and opts for the first option
(Gerard, 1981).
To check
the issue related to the banking payment in rural areas, series of following
questions have to be answered:
Ø Has the
Banking payment of state agents as it is applied and smeared with several
issues contributed to reinforce the proximity of the banking network to the
employees despite it is completely under the monopoly of the State?
Ø Has the
request of the mobile banking to supplement the financial intermediation of the
banks can respond to the financial increased needs?
OBJECT
AND CONTEXT
A. Object
This
topic aims to highlight banking issue realities to the Congolese community and
to the researchers. Few authors dwelt to explore the thematic despite that
B. Context
Payment
of state agents through the banking system is a project aligns in the
institutional reform proposed by the DRC government in order to strengthen the
monitoring of agents working on public sector.
It aims to respect the economic program of the government avoiding
accumulating arrears in salary payment. This implies a preliminary
harmonization of state agents’ payment circuit. On the practical level, this project refers to wage
payment through bank account. This meant that the intervening banks, partners
of the government, will have to open individual bank accounts for all its
recipients to facilitate their financial transaction (Mvuemba, 2014).
The
Congolese government concerned to the issue was determined to succeed on
implementing the banking system and master the state agents’ personnel
countrywide. Difficulties related to lack of banks in certain regions make Non
Governmental Organizations (NGOs) such as Caritas ASBL to substitute on bank
agencies and proceed on salary payment.
It usually occurs in certain circumstances a reducing of 5% of the total amount of salary to be
paid to the recipients. It is in that particular context that ISEA-Mvuazi and
other governmental institution such as INERA-Mvuazi was affiliated to the
International Bank of Credit (BIC in French) based at Mbanzangungu agency.
Currently, BIC has been sold to the First Bank of Nigeria (FBN Bank).
The
implementation of the banking payment of ISEA-Mvuazi agents was established in
particular manner different from the one planned by the government.
METHODOLOGY
The
methodology followed in this study is simultaneously quantitative, qualitative
and hypotheco-deductive. Data used were compiled on a data base collected from
the literature review and the World Bank report as well as related work
conducted in Western Africa and elsewhere.
LEVEL OF
BANKING SYSTEM
First
point of obstacle: density of the banking network
The
banking system has been viewed in relation with the population density in one
hand while it was considered in relation to the number of people holding a bank
account on the total population in the other hand.
Banking
network can be considered as offices or agencies and other related services
where banking services are dealt (Gansinhoundé,
2008, ), it works pratically by
using electronic card working in several banks (Poullet et al., 1995; Nigudge&Pathan,2014). However, the banking system is defined as the
proportion of population holding a bank account and can be estimated by the
rate of the penetration of banking services.
Penetration level of the banking services
through the populations can be estimated on the basis of the banking network
density (Bouzar&Ammour, 2011).
Dd =
Na/Tp: Demographic density of the banking network;
Na:
Number of banking agencies;
Tp:
Total population
It has
been found that the banking services remains inaccessible for most of the
population in south western part of D.R. Congo. Peachey & Roe
(2004) emphasize the difference between the North and the South indicating that
10% of the populations of the developing countries have an access to the
banking services against 90% in the industrialized countries.
This gap makes the comparison rather difficult between these two
categories of country (Peachey and Roe, 2004).
The
density of the banking services in Kongo Central province is equivalent to the
one characterizing developing countries ie low density of banking networks
(Table1) (Gansinhoundé, 2008). The issue is illustrated when examining that
the province possesses only 26 banking agencies for a population of 2.866.047
people (Table 2).
The rate of banking services
The rate
of the banking services (Rb), in the same logic, is calculated according to the
relationship observed between the number of people holding a bank account and
the total number of population (see Table 1). This can be
expressed as:
Rb1 = Pb/Tp:
Portion of population having a bank account
Pb:
number of people having a bank account;
Tp:
total population.
The
public sector accounts nearly 12% (that is to say 343.925,64 agents) of
employment in the Kongo central province. The rate of banking
services in the province is also equal to 12% if we consider that each agent
has a bank account (Moreira, 2016).
Table 1:
Provinces
|
Social Siege |
Banking agencies |
Tellers |
Total |
In % of the total |
Kinshasa |
18 |
106 |
35 |
159 |
52,5 |
Katanga |
1 |
37 |
5 |
43 |
14,2 |
Kongo Central |
0 |
26 |
1 |
27 |
8,9 |
Province Eastern |
0 |
21 |
3 |
24 |
7,9 |
North-Kivu |
1 |
22 |
0 |
23 |
7,6 |
Others provinces(6) ¶ |
0 |
26 |
1 |
27 |
8,9 |
Total |
20 |
238 |
45 |
303 |
100 |
Source: Report of the recent economic situation in
Kongo Central province, Central Bank of Congo. Moreira,
2016
The low
concentration of the banking institutions in Kongo central province especially
in Mbanzangungu, leads the state agents to pay a tribute due to the fact that
their professional site is located in a region where banking structures do not
exist yet despite the government issued over the country the banking system
operation (Table 1 and 2).
Table 2: Demographic data of the
Kongo Central province
Territory or city |
Population
(hab.) |
Surface
(km2) |
Density
(hab./km2) |
Kasangulu |
43.091 |
4.680 |
9 |
Kimvula |
125.605 |
3.371 |
37 |
Lukula |
420.313 |
3.270 |
129 |
Luozi |
322.197 |
6.784 |
47 |
Madimba |
560.226 |
7.968 |
70 |
Mbanza-Ngungu |
518.914 |
8.507 |
61 |
Seke-Banza |
280.916 |
3.620 |
78 |
Songololo |
265.659 |
8.190 |
32 |
Tshela |
329.125 |
3.090 |
107 |
Total |
2.866.047
|
49.480
|
58 |
Source:
Report of the recent economic situation in Kongo Central province,Moreira 2016
For
illustration, Germany holds the higher density of banking agencies estimated at
570 for a population of a million of people in 2006. It is followed by
Switzerland and Australia (Gansinhoundé, 2008)
In
contrast, the banking network in developing counties is generally less dense
expressing a geographic exclusion from which an important portion of people are
victimized. This is meant that the poverty has a pecuniary origin (Bumacov,
2012).
The
density of banking agencies for West African for Economic and Monetary Union
(UEMOA) countries is estimated at 1 agency for 116.000 habitants (peoples)
while in Morocco, it is at ratio of 1 agency per 10.000 habitants. The density of the Algerian banking network
is at 1 agency per 7.250 habitants (Gansinhoundé, 2008). Densities of banking
networks of different countries are not comparables. Difference in
implementation fixed in each country drives the banking system.
The rate
of the banking system is generally low as well as the economy of a country is
not prospered and the banking sector is less developed (European Union report,
2011). It depends to the banking systems
of different countries. In addition, disproportion of population density and
acquisition of new technologies are major issues.
Second point of obstacle: Population density in
relationship with access in payment system
Access
to the bank account for getting payment remains an issue for the majority of
agents holding account the FBN Bank. The
agency of FBN Bank/MbanzaNgungu disposes only of one teller (Table 3).This is
obviously, a social issue that call the legitimating intervention of the
state (Gerard, 1981).Therefore, it is
usually observed a huge number of people when approaching the 20th
and 25th of the month. According the International Office of Work
(2003), the salary of the state agents should be regularly paid in an interval
which can permit workers to avoid to contract debt. It is evidence among
exceptions. However, it is important to
note that currently Mbanza ngungu town counts also Procredit bank among
commercial bank serving state agents.
The latter bank has installed automatic teller and other electronic
payment points reducing the influx of the agents in bank during payment period.
Mobile banking can avoid state agents to move and favor them to do their
business independency (Amory, 1989).
Table3: Number
of commercial bank exploited by BCC in 2012
Provinces |
Teller |
Kinshasa |
35 |
Katanga |
5 |
Kongo Central |
1 |
Western Province |
3 |
Nord-Kivu |
0 |
Other provinces(6) |
1 |
Total |
45 |
Source: Report of the recent economic situation in
Kongo Central province, Central Bank of Congo (Moreira, 2016).
Delays in payment system: New technology
acquisition in rescue of the payment
The
process of mastering state agents personnel has accidentally created the
banking payment of agents. Some issues have been solved in one hand but in the
other hand, all other problem and related situation depend to the government
politics. After Kinshasa, implementation of banks throughout the provinces
should follow up the banking payment in other towns where their agencies exist
before finally reaching the rural areas. Electronic transfer of fund can have
an extend advantages if the service providers pay attention to the need of
people categories. These categories concern people living in rural areas and
weakly connected to the world (Thunis & Schauss, 1988). Therefore, banks
should work in partnership with the mobile operators to implement the mobile
banking for the payment of agents in rural areas where the mobile network is
covered but bank agencies are not established.This has been confirmed by the
president of the Congolese bank association. The installation of automatic
distributor such as ATM has avoided people or agents to move and to deal with
their business independently (Thunis&Schauss, 1988; Amory, 1989).
Mobile banking
The
banker has to look for the client. It is a dynamic approach which is more
flexible as argued Bank of Africa president.
Nowadays, we are assisting on a race of purchasing clients through
opening of bank agencies and introducing new technologies such as the mobile
banking. The magic formula used in the phone has permitted to transfer the
money and pay invoices (Bastien, 2010). Auto regulator practices emergence
illustrates by the soft law express the flexibility of adaptation (Thunis &
Schauss, 1988).
According
to Nigudge&Pathan(2014),
electronic banking is a set of electronic and computer techniques and devices
that enable the automation of banking transactions. Mobile banking is proving
to be one of the components of e-banking and is defined as a service that allows
money transactions to be carried out using a mobile phone. In that way, it is
unquestionably available to all ISEA- Mvuazi agents.
Some benefits
Security:
money will no longer be managed physically but rather virtual, this will avoid
theft, mistakes, vandalism and financial malpractice.
Speed
of payment: some customers wanting to pay their bills do not do
it promptly due to lack of time or someone to trust and to send.
The weakness of the banking culture and the
mistrust of the banking system by the beneficiaries are other factors which do
not facilitate the infatuation with the modernization of the payroll of agents
both locally and nationally. The mobile banking has allowed customer to make
the payment of the employees with ease and comfort thanks to this service. The
cost of transport amounts to more than 1/8 of what is perceived by an official
attached to the ISEA-Mvuazi. It is avoiding travel and queuing, both at the
bank and in other providing services (supermarket, petrol station, etc.),
despite the branch that is supposed to serve agents is located in further
kilometers from agents’ institution. The banking system as lived by ISEA-Mvuazi
agents seems to be considered as a sort of way of the cross but not as anything
else. In that regards, it has been demonstrated in the current investigation
that little advancement has been conducted. To conclude our investigation, we can explore
Gansinhoudé (2008) statement that said that developing countries which suffer
from bank network insufficiency need new technologies to accelerate the banking
system process which can solve banking issues countrywide.
CONCLUSION
To the
questions raised above, we found that from its inception, banking the salary of
DRC worker was not in any way a form of payment. The Congolese government
wanted to achieve its goal of controlling its employee personnel. As a result,
the government was no longer concerned about the damages generated during the
implementation of the process. From our investigation, we find that the banking
system remains embryonic and cyclical in spite of the various political
declarations. We believe that the banking system should encompass the entire
Congolese financial system, which will allow better management of the money
flow transiting this day outside the banking circuit. It can also participate
in financing effectively new bank account holders. Hence, we advocate,
therefore, mobile banking to reach individually each agent within different
layers of the population. In addition, we are encouraging the modernization of
the interbank payment system and the electronic banking system, which must also
be started. This network will supervise all the electronic processing operations
carried out via the vending machines of the banknotes and the electronic
payment terminals, to be made available to agents at bank branches.
Acknowledgement
Authors are grateful to
the InstitutSupérieurd’EtudesAgronomiques de Mvuazi (ISEA-Mvuazi) for allowing this research article
to be conducted. We are also grateful to the library of Law faculty of
university of Kinshasa for providing us documentation to improve our literature
review.
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