BPNG: Savings facility on hand

 By PISAI GUMAR

THE ordinary people’s hard-earned cash is usually not properly saved or spent, Bank of Papua New Guinea Deputy Governor Benny Popoitai said.

He also noted that the lowly buai – one of the basic goods in Papua New Guinea – fetches almost K5 million annually and generates good income for those in the informal sector.

Popoitai made this observation during the opening of the PNG Microfinance Ltd (PML) branch in Lae on Monday

He said ordinary people engaged themselves in income-generating activities such as selling buai to improve their lot.

However, the opportunities for them to save what they had earned in banks and savings institutions were not given enough importance.

Popoitai said the two main obstacles that prevented small people from saving could be financial illiteracy and lack of access to banking facilities.

“Knowing the ordinary people’s hardships, BPNG has allowed for the creation of four micro-banks with affordable products to reach out to and encourage rural Papua New Guineans to adopt and cope with savings culture,” he  said.

“It is not about savings alone but it is also crucial to encourage ordinary people to create wealth for themselves by making use of available resources, saving and borrowing money, talking on money matters, investing and involving themselves actively in small business activities to lift themselves up from poverty,” Popoitai said.

He assured the people that PML had in place convenient financing schemes and products that suit the ordinary people’s personal or business needs.

PML chief executive George Mathew said the institution was owned by PNG Sustainable Development Program (PNGSDP) and International Finance Corporation (IFC), with 14 branches nationwide.

Two significant items among seven savings and six loans products were school fee savings and school savings.

“School fee savings is for parent or guardians who wish to save for their children while school fee savings account targets schoolchildren from age eight to 25,” Matthew said.

“This would instil the habit of savings which allows the bank to chip in a percentage annually as an interest income and it is tax-free.”