Zambia is a landlocked country in Southern Africa with a population of approximately 20 million people. The economy is largely driven by mining (particularly copper), agriculture, and increasingly, digital financial services. [From previous search] The Parliament of Zambia formally passed the Data Protection Act, 2021 on March 23, 2021.
The country has made notable progress in financial inclusion, though significant gaps remain. [From previous search] Zambia demonstrates significant progress, with mobile money adoption contributing to a 69.4% financial inclusion rate, driven by widespread mobile phone penetration and robust infrastructure in urban areas. However, [From previous search] according to the World Bank, only about 30 percent of Zambians have access to formal financial services, and about 10 percent of micro, small, and medium sized enterprises are banked.
[From previous search] With just 20.7% of adults accessing formal banking services, the NFIS II identifies mobile money as a critical tool to achieve the nation’s goal of 85% financial inclusion by 2028.
The Bank of Zambia (BoZ) is the central bank and primary regulator of the financial sector. [From previous search] Fintech in Zambia is governed by various pieces of legislation, depending on the type of financial service offered. There is no single piece of legislation that governs the entire fintech industry.
[From previous search] Fintech is primarily governed by the Banking and Financial Services Act No. 7 of 2017, the National Payment Systems Act No. 1 of 2007, the Insurance Act Chapter 392 of the Laws of Zambia, the Data Protection Act No. 3 of 2021 and the various regulations and directives issued pursuant to the foregoing.
[From previous search] Regulators like the Bank of Zambia and the Securities Exchange Commission have put in place frameworks for regulatory sandboxes to promote innovative fintech products. These sandboxes allow the testing of new products and services on the market without putting consumers at risk.
Open banking has not been formally implemented in Zambia. There is no comprehensive regulatory framework governing API-driven data sharing or third-party access to financial data. While certain financial institutions have begun exploring digital integration and API-based services, these remain individual initiatives rather than market-wide mandates.
National Financial Switch (NFS)
[From previous search] The National Financial Switch is a shared payment systems infrastructure that interconnects various payment streams ranging from Auto Teller Machines (ATMs) to Point of Sale Systems (PoS) to mobile money payments. It is a payment gateway that facilitates efficient payment processing and interoperability between the service offering of commercial banks, non-bank financial organizations, and various other payment institutions within Zambia.[6]
[From previous search] 10 systems are progressing toward mature inclusivity, including the National Financial Switch (Zambia), among others like GIMACPAY, EthSwitch (Ethiopia), Mobile Money Interoperability (Ghana) and Instant Payment Network (Egypt).[3]
National Financial Inclusion Strategy II (2024-2028)
[From previous search] The recently launched NFIS II aims for an 85 percent inclusion rate by 2028, up from the 2020 achieved rate of 69.4 percent.[8]
Mobile Money Ecosystem
[From previous search] As of recent reports, approximately 58.4% of the adult population in Zambia uses mobile money services.[1]
[From previous search] Mobile money services, such as Airtel Money and MTN Mobile Money, are widely used for financial transactions in the country, providing convenient and accessible banking services to a large portion of the population.[6]
[From previous search] The Parliament of Zambia formally passed the Data Protection Act, 2021 on March 23, 2021.[4]
[From previous search] Enforcement of the Data Protection Act No. 3 of 2021 begins in March 2025. This marks a crucial milestone in Zambia’s data protection landscape, ensuring compliance with legal standards, strengthening the protection of personal data, and fostering accountability among organisations handling personal information.[9]
[From previous search] Under the Data Protection Act No. 3 of 2021: Personal data must be stored on local servers in Zambia, barring few exceptions. Cross-border transfers require both consent and Data Protection Commissioner approval.[10]
This data localization requirement and the consent-based framework for cross-border transfers create an important foundation for any future data-sharing arrangements, though they also introduce considerations for fintech companies seeking to operate across borders.
[From previous search] The sector has become an attractive target due to the rapid growth of Zambia’s Digital Financial Services (DFS), fueled by increased mobile phone penetration, and the demand for more accessible and convenient financial solutions. Additionally, the interconnectedness of financial systems with the mobile operators and other third parties has widened the sector’s exposure to cyber and fraud risks, creating a vast and complex ecosystem vulnerable to cyber threat and frauds.[8]
Key challenges include:
Regulatory Uncertainty: No comprehensive open banking framework exists. Clear guidelines on API standards, data sharing protocols, and third-party licensing would be needed.
Infrastructure Gaps: While mobile money penetration is high, formal banking infrastructure remains limited, particularly in rural areas.
Cybersecurity Concerns: The growing interconnectedness of financial systems has increased exposure to fraud and cyber risks.
Digital Literacy: Gaps in consumer understanding of digital financial services and data rights could slow adoption.
Should Zambia pursue open banking in the future, several opportunities exist:
Credit Access: Open banking could enable alternative credit scoring using transaction data, expanding access to loans for the underbanked population, particularly MSMEs.
Leveraging Mobile Money Data: With 58.4% mobile money usage, there is a substantial data foundation that could support innovative lending and savings products.
Building on the NFS: The National Financial Switch provides an interoperability backbone that could be extended to support API-based data sharing.
Regional Integration: Zambia’s position in SADC and COMESA offers potential for cross-border open banking frameworks as regional financial integration deepens.
Zambia’s immediate focus remains on deepening financial inclusion through mobile money expansion, improving the National Financial Switch, and implementing the Data Protection Act. The enforcement of data protection regulations from March 2025 creates new clarity around data handling that could eventually support more sophisticated data-sharing arrangements.
Open banking is not currently on Zambia’s stated regulatory agenda, but the building blocks are being assembled. The country’s trajectory suggests that any future move toward open banking would likely be regulator-led and phased, building on the payments interoperability work already underway rather than introducing market-driven API mandates.
Open Banking Nigeria (Open Technology Foundation) is a non-profit backed by a group of industry experts across banking, fintech, risk management, and more to drive and launch the open banking standard in Nigeria.
