Salary accounts for civil servants: a step in the right direction

By Lamin Jahateh, Banjul A recent statement from The Gambia government through the directorate of the National Treasury urges all civil servants within the Greater Banjul Area from grade 2 and above to open salary accounts “through which their salaries will be paid”. The new development has a lot of positive effects it can engender in the national economy, such as giving the banks greater financial intermediation, and enabling them to have more resources to lend to the people, which can spur investment growth and national development. It can also give civil servants a good track record of banking relationship as well as enable them to get loans from banks. The association of bankers in the country has therefore lent its support to the initiative saying “it is a step in the right direction” since it will ensure all civil servants within the Greater Banjul Area open salary accounts. Pic: Mr. Mamour Malick Jagne, Executive Secretary of Gambia Bankers Association “This is a most welcome move. It is a step in the right direction,” said Mamoud Jagne, executive secretary of Gambia Bankers Association (GBA).  “It is a means of incorporating all those who are not in the formal banking sector to come to the banking sector.” Mr Jagne also encourages civil servants in the provinces that have access to banks to also open salary account. “I would even encourage those who are not within the Greater Banjul Area, but they are in the provinces - in places that are not far from banks - to open salary accounts,” he said. Outlining the benefits mass civil servant salary accounts would have in the economy and to civil servants, the GBA executive secretary said: “This has a lot of positive effects in the economy: It helps to strengthen the banking industry; it gives the banks greater financial intermediation, and it enables the banks to have more resources to lend to the people. “Furthermore, on the side of the civil servants, it gives you a history of banking relationship, it enables you to get some loans from the bank, and it also gives you security of your funds and you can access it at anytime. “This is a very good development and I will encourage everyone, whether in the civil service, in the parastatals or anybody who is earning an income to open an account and use the account so that you have a financial history with an institutions that in the day of need they can support you.” Mixed concerns However, since the announcement was made, many people have expressed concern and worries that the new development will give rise to congestion of banking halls and delay in receiving salaries, as lots of employees would swarm the banks at the end of each month to collect their salaries. Some civil servants who spoke to this reporter on the issue, expressed dissatisfaction with the directives from the National Treasury, saying that apart from the hours they will spend at the bank waiting to receive their salaries, their take-home pay will suffer charge cuts and deductions that can be unbearable.  “Really I am not encouraged by the whole system,” said Fabakary Kujabi, a grade 4 salary earner. However, Ousman Sonko, another government employee, said a salary account will make it possible for employees to have loan from the banks. “So it is a welcome move and it has come at the right time”. The banks, it is expected, can live up to the challenge of serving the banking public and the mass of would-be salary account holders. “This is because the banks are businesses that are concerned about quality and efficient service delivery,” the GBA executive secretary said. He added: “The banks are businesses and are concerned about the comfort and the quality of their services. I can say that the banks, as from now, will respond by making sure that people spend less time, and if they know that more people are coming they will employ more staff, and that alone have its own benefits in the sense that you employ more cashiers to attend to these people, and people will spend less time in the banks.” The order of day in the region Creating salary accounts for government employees is fast becoming the order of the day in many countries in the region, such as Malawi, whose government has just issued a similar directive that all civil servants in the country should open salary accounts; although many civil servants in that southern African country have so far condemned the move saying the banks will cut some charges from their already “small salaries”. As similar fears as those of the Malawians loom large among government employees in The Gambia, the GBA executive secretary says favourable terms of accounts and their benefits can be differed from bank to bank. “In The Gambia, we have 13 banks that are competing and I am sure if you go to a bank and negotiate your terms and conditions you will get a good deal that you can afford,” Mr Jagne argued. “So I am not worried about that aspect of it because the competition will force the banks to give customers the best deal possible. When you go to any bank to open a salary account, you can negotiate with them and have a good deal.”