A Study of the Effect of the Treasury Single Account on Commercial Banks Deposits and Lending in Zambia
Journal Title: Journal of Economics, Finance and Management Studies - Year 2024, Vol 7, Issue 05
Abstract
The implementation of the Treasury Single Account (TSA) in Zambia brought about drastic changes in the management of public funds. The Bank of Zambia assumed custodianship of public funds while Commercial Banks remain revenue collection agents throughout the country. This study investigated the effect of the TSA on Commercial Banks Deposit Mobilization and Lending in Zambia. Secondary and Time series data were collected from the Bank of Zambia (BOZ) annual reports covering the pre- and post-TSA implementation eras, over a ten-year period (2010-2019). The independent variable was represented by Government Deposits (representing the TSA), while aggregate Commercial Banks Deposits and Loans and Advances were the dependent variables. The data were analysed using descriptive, regression and correlation analysis, with the aid of IBM SPSS Statistics version 28. The findings of the study revealed that Government Deposits have a significant positive effect on Commercial Banks Deposit Mobilization [(P-value 0.001; (CI: 95%)]. The study also revealed that Government Deposits have significant positive effect on Commercial Banks Loans and Advances [(P-value 0.001; (CI: 95%)]. The trend analysis on Government Deposits further revealed a slow growth in Government Deposits after TSA implementation compared to the pre-TSA period. The trend analysis on Loans and Advances also revealed a slower growth in Loans and Advances during the post –TSA era. The study therefore concluded that the TSA which aims to withdraw Government Deposits from Commercial Banks has a negative effect on Commercial Bank Deposits and their lending ability. The study recommended that banks should develop strategies to attract private sector deposits, to fill the void created by the implementation of the TSA. Banks should come up with innovative solutions to tap into the unbanked population. It is important that banks develop attractive savings products to encourage the culture of saving among citizens. The study further recommended that the Ministry of Finance should consider allowing Commercial Banks involved in revenue collection, a few days float before revenue is remitted to the main TSA account at Bank of Zambia (BOZ).
Authors and Affiliations
Felix Mulenga , Dr. Taonaziso Chowa,
Keywords
Related Articles
- EP ID EP735006
- DOI 10.47191/jefms/v7-i5-12
- Views 77
- Downloads 0
Comparative Analysis of Share Price, Company Value, and Company Profitability
The covid-19 pandemic from the end of 2019 until now has significantly impacted stock price movements, company value, and company profitability, including companies in the primary consumer goods sector (consumer non-cycl...
Analysis of the Potential Economic Bubble Burst in Indonesia (Case Study on Start-Up Companies)
The phenomenon of the bubble burst remains a topic of debate regarding its existence. Even though many start-up companies have implemented large-scale layoffs, the utilization of various technological facilities that eme...
Production and Disruptions of Prawn and Crab: Basis for Supply Chain Management Strategies
Supply chain management strategies will help the prawn and crab growers mitigate and adapt to the impact of various disruptions such as typhoons, water-borne diseases, and climate change. The study was conducted to deter...
Navigating Customer Satisfaction: Unveiling The Factors Shaping Reuse Intentions For Pln's New Mobile App In Aceh
This study seeks to assess the impact of Performance Expectations, Business Expectations, Facility Conditions, and Social Influences on Customer Satisfaction, influencing the intention to reuse the new PLN Mobile Applica...
Unveiling the Nexus: Foreign Ownership, Innovation Dynamics, and Firm Performance through a Resource-Based Lens in Vietnam
This study investigates the complex relationships between firm resources, innovation, foreign ownership, and firm performance in the context of Vietnam's emerging market. Using a comprehensive dataset of 17,430 firm-year...