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Rose Moremoholo


MOBILE money transfer platforms have helped empower consumers and brought thousands more into the financial sector, according to the deputy governor of the Central Bank of Lesotho (CBL), Masilo Makhetha.

Makhetha was speaking at the launch of the Mobile Money Campaign on Monday. The campaign to promote the use of mobile money platforms will end on Friday.

Launched in 2012, Vodacom’s M-Pesa and Econet Telecom Lesotho’s Ecocash have helped thousands in rural areas make financial transactions and save money.

Nearly 70 percent of Lesotho’s 2 million people live in rural areas.

The central bank sees the platforms as a solution to its ambition to bring more people, especially those in rural areas, into the financial sector.

Lesotho’s geography means some people live in far-flung areas in the mountains where commercial banks don’t see economic value in putting branches.

Using the existing mobile network, money transfer platforms have bridged the gap between customers and the financial services. Distance is no longer a barrier.

Once thought to be just a convenient way to communicate, the mobile phone is now providing ways to send and receive money as well as paying bills. The result is that a farmer in the backwaters of Mokhotlong, for instance, can pay for his fertilizer in Maseru.

People once considered unreachable by commercial banks now have access to financial services.

Banks too have been quick to tap into the mobile money market, both as a way of fending off competition from mobile networks and enhancing convenience.

Insurance companies have also entered the fray, using the platforms to offer simplified products and easier ways of paying premiums.

All these, according to Makhetha, have helped improve levels of financial inclusion in Lesotho. And this is happening without the need for huge investment in Automated Teller Machines (ATM) and bank branches in remote areas, he noted.

“It cannot be disputed that mobile money is changing the face of banking globally. Traditional banking was built with branches, cards and large deposits in mind, whereas billions of users are small depositors and business located far from branches,” Makhetha said.

He said this means the conventional banking system has not been able to provide financial services to larger numbers of low-income and poor people especially in the remote areas because of the high costs of physical infrastructure and operational costs.

“On the contrary, mobile phone systems can be placed anywhere as long as there is wireless phone connection and this overcomes the problem of distance and lack of bank branches in remote areas,” Makhetha said.

“For people without bank accounts they can easily use this system which will enable them to save and use money in a safer manner than putting it under mattresses”.

He revealed that since last December M-Pesa and Ecocash have circulated at least M68 million. Comparative figures for the same period last year are not available.

As of December 2015 there had been 751 743 airtime purchases, 243 169 cash withdrawals, 321 768 bill payments and 221 257 domestic money transfers.

Makhetha however said the tremendous growth has not been without huge challenges, most of which have nothing to do with system but market dynamics.

The use of the platforms as a way to pay salaries is yet to catch on in the market.

This is despite the mobile money’s “potential to reduce the hurdles of salaries processing of contracts and casual workers by different organisations in the country including the government of Lesotho,” said Makhetha.

He said banks, mobile operators, retailers and independent companies have to work together to enhance the use of mobile money platforms.

“In this context, payments and banking must be available everywhere for people to trust it. We have to strengthen the legal and regulatory framework. To this extent, e-money regulations have been drafted”.

“Even though the Payment System Act 2014 is in place there is need for further improvements on the legal and regulatory framework.”

He said there is need also to promote mobile money literacy among low income groups because people in the most remote areas of Lesotho don’t understand how to use mobile money.

Other problems have to do with the concentration of mobile money agents in towns and their lack of liquidity. Makhetha said there is an opportunity for Lesotho to reach the same level as Kenya and Tanzania in mobile money usage.

“For this to happen we appeal to mobile money operators to protect the system because there are people who abuse its usage. For example, pyramid schemes that are taking advantage of people,” he said.

A 2011 survey showed that Lesotho has a very high level of access to financial products – the highest among 15 countries surveyed. The FinScope survey revealed that only 19 percent of Lesotho adults are not financially served.

This is compared to 27 percent in South Africa, 31 percent in Namibia, 33 percent in Botswana and 37 percent in Swaziland. The writers of the report on the survey were however careful not to equate access to financial products to financial inclusion.

This high level of inclusion, they said, is driven by very high usage of insurance, primarily funeral insurance (formal as well as informal), which is used by 62 percent of adults.

The survey found that 38 percent of adults have a bank account and a further 23 percent have another form of formal financial service.

This, the report said, means that 61 percent of Lesotho adults are formally included. A further 20 percent are only served by informal financial services.

“Informal usage is very important. In total, 62.4 percent of the adult population use informal financial mechanisms, spread across informal savings, insurance and credit.’’

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LEC to switch off households over debts



MASERU – The Lesotho Electricity Company (LEC) will from Tuesday next week begin switching off clients who owe it money.

The LEC issued a seven-day ultimatum to all customers who owe it on Tuesday last week. The deadline ends on Monday.

It is expected that the LEC will begin switching off households that have defaulted.

The state-owned power company, however, is not going to touch any government department or business entities that owe it on grounds that they are in payment negotiations.

The LEC move comes barely two weeks after it cut electricity supplies to the Water and Sewerage Company (WASCO) thus causing it to fail to pump water to communities countrywide for more than two days.

The LEC says it is owed close to M200 million by government departments, businesses and individuals.

The LEC spokesman, Tšepang Ledia, told thepost that the government and the businesses will not have their electricity cut because they are in negotiations.

“We are in negotiations with the government and businesses and hopefully they will pay,” Ledia said.

“We advise the ordinary people to pay their debts before the 20th of March 2023 or else we cut the services,” he said.

The LEC says it is running short of funds for its daily operations.

In December last year the company increased power tariffs by 7.9 percent on both energy and maximum demand charges across all customer categories for the Financial Year 2022/23.

Last week the LEC boss, Mohato Seleke, said postpaid consumers and sundry debtors owe the company M169.4 million.

He said unless the debtors pay he will be unable to buy electricity from ’Muela Hydropower Project, Eskom in South Africa and Mozambique’s EDM.

This, he said, could cause serious load shedding in the country and could be devastating for businesses.

Seleke said the LEC spends M630 million monthly to buy electricity.

“If postpaid consumers do not settle their debts this could prevent the LEC from being able to buy electricity which can lead the country to encounter load-shedding,” Seleke said.

Seleke said collecting debt from government department ministries was a challenge as there is an understanding that since LEC is a state-owned company, it will continue supplying government agencies with electricity and they will settle their bills when they have funds to do so.

Seleke said the LEC has lost M21 million to vandalism during this financial year.

Relebohile Tšepe

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Bumper payout for former mineworkers



MASERU – AT least 11 316 current as well as former mine workers are set for a bumper payout after Tshiamiso Trust began disbursing the first billion Maloti to workers who are suffering from silicosis and tuberculosis.

The payment comes two years after Tshiamiso Trust began processing claims for the historical M5 billion settlement agreement between mineworkers and six gold mines in South Africa.

Speaking at the payment announcement in Maseru last week, the Trust’s CEO, Lusanda Jiya, said it has been two years since they officially began accepting claims.

“Our people come to work every day with the mission of impacting lives for the better, and the first billion rand paid out to over 11 000 families is just the beginning,” Jiya said.

“We know that there is no compensation that will ever be enough to undo the suffering endured by mine workers and their families,” he said.

“However, we are committed to deliver our mandate and ensure that every family that is eligible for compensation receives it.”

Jiya said the Trust is limited both in terms of the time in which they can operate, and the extent to which they can assist those seeking compensation.

Broadly speaking, the eligibility criteria include among others that the mineworker must have worked at one of the qualifying gold mines between March 12, 1965 and December 10, 2019.

Secondly, living mineworkers must have permanent lung damage from silicosis or TB and deceased mine workers representatives must have evidence that proves that they (the deceased) died from TB or Silicosis.

Tshiamiso Trust has a lifespan of 12 years, ending in February 2031.

Over 111 000 claims have been received to date, through offices in South Africa, Lesotho, Botswana, eSwatini, and Mozambique.

The Trust is working with stakeholders in these countries and others to mobilise its efforts and expand operations.

The history of silicosis in South Africa goes back to the late 1880’s when the first gold mines began operations.

The gold was stored and locked in quartz, a special rock that contains large amounts of silica.

Crystallised silica particles can cause serious respiratory damage if inhaled.

In the earlier days of gold mining, dust control, health and safety standards and the use of PPE (personal protective equipment) were not as advanced as they are today.

Tshiamiso Trust was established in 2020 to give effect to the settlement agreement reached between six mining companies.

The companies are African Rainbow Minerals, Anglo American South Africa, AngloGold Ashanti, Harmony Gold, Sibanye Stillwater and Gold Fields.

The settlement agreement was reached and made after a ruling by the Johannesburg High Court as a result of a historic class action by former and current mineworkers against the six gold mines.

Justice for Miners is a coalition of interested parties in the mining sector launched at the Nelson Mandela Foundation in Johannesburg in 2020.

The Johannesburg High Court approved the setting up of the Tshiamiso Trust to facilitate payment by the companies to affected miners.

Keith Chapatarongo

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Farmers cry over cost of livestock feed



MASERU – Lehlohonolo Mokhethi is a farmer who has been running a successful poultry business, thanks to a small loan he got from a local bank.

He now has 300 chickens.

He says his vision is to rear 5 000 chickens by 2025 and employ 30 youths. But he is now grappling with a new challenge: the ever increasing cost of chicken feed.

That is threatening the viability of his business.

“The biggest challenge is that food prices increase every day, feeding is expensive,” Mokhethi said.

“It is quite difficult to make profit in business if each and every day food prices increase. Today I am buying a bag of food with a certain amount then the next day the price has increased,” he says.

“Our customers fail dismally to understand that food has increased and the Chinese are taking our market because they sell at a low price thus I run at a loss.”

Last week, a top attorney in Maseru who is also a prominent farmer, Tiisetso Sello-Mafatle, called a meeting for farmers to discuss these challenges.

She says the government must regulate the prices of livestock feed.

That is critical if the farming business is to succeed, she says.

Attorney Sello-Mafatle says farmers must come up with a structure for livestock feed prices which they would present to the government for gazetting.

“We should state our regulations and give them to the government to make everything easy for both parties because we cannot wait for the government to make regulations for us,” Sello-Mafatle says.

She adds that “farmers should be bullish about what they want and never have fear endorsing new things”.

“I will not be challenged or cry (because of) what life throws at me but I will cry when things are not happening the right way,” she says.

Mafatle says farmers need to know who they are and know the capabilities they have.

“This will help a farmer in becoming the best in any field they are in once they are confident about themselves,” she says.

Karabo Lijo, another participant, said they have to influence the cost of inputs in agriculture, especially livestock feed.

“We have to go back to cost-price analysis where as farmers we are able to derive the selling price and the break-even point in our production,” Lijo said.

“We can also derive the stable or constant mark-ups on our products,” he said.

“We need to do research to increase the ability to produce byproducts which are likely to have the longest shelve life,” he said.

The meeting urged farmers to diversify their products by introducing such things as mushroom farming. They said mushrooms can grow very well in Lesotho due to its favourable climate.

The farmers also demanded that there should be regulations on how land can be sold or borrowed in Lesotho.

Tholoana Lesenya and Alice Samuel

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