The Senior Save Account and the Necessary Infrastructure of the Banking Industry in Namibia - Paper Example

1.1 Background Information

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1. Introduction

Namibia is a country with various beautiful features that need to be appreciated to help in highlight the impacts that it has both on the citizens and its neighbors through the promotion of the cohesion and integration in the region (Jat, Haodom, and Peters, 2016, p89). It is a vast, and a sparsely populated country that is situated along the south Atlantic coast of Africa, and lies between 17 degrees, and 29 degrees south of the equator. The country ranks number 34 worldwide regarding its geographical size and has a total area of 824292 square kilometers, and stretches 1300 kilometers from south to north, and diverges from 489 to 930 kilometers from west to east. What needs to be highlighted in the country is the vast wildlife resources that the country enjoys, and this is apparent in the high numbers of cheetah population among other wild animals in the various national parks and game reserves (Desta and Desta, 2016, p588).

In addition to the huge numbers of wildlife in the country, Namibia also has historical sites and this are situated in the capital, Windhoek, and in the coastal town of Swakopmund where there are German colonial-era buildings. The German colonial-era buildings include Christuskirche, which is situated in Windhoek and was built in the year 1907, such helps in increasing tourist attraction activities in the country and serves as a source of revenue for the country (Amadhila and Ikhide, 2016, p282). Another avenue where the country draws a high number of tourists is the salt pan in Etosha National Park that attracts a huge number of wildlife among them being Giraffes and Rhinos. Regarding governance, the country was initially under the government of South Africa until the year 1990 according to the United Nations peace plan for the whole region that forced forces from South Africa to pull out its influence from the country. The country harbors the oldest desert, The Namib desert, in the world. The Namib Desert stretches along the west coast of the country, and The Kalahari Desert stretches along the south eastern boarder with Botswana (Samahiya and Kaakunga, 2014, p4). Finally, the country is divided into fourteen regions which are Zambezi, Omusati, Kavango East, Oshana, Kavango West, Oshikoto, Kunene and Onhagwena regions in the north. The regions in the central part of the country are such as Omaheke, Erongo, Otjozondjupa and Khomas, the regions in the south of the country are such as Hardap and Karas with the capital of the country being Windhoek.

1.1 Background Information

It is apparent that the banking industry in the country is under great competition, and various banking institutions are under stiff competitions to capture as large market share as possible, and this is the reason behind the numerous innovative activities in the banking industry (Turner, 2014, p891). In this relation, there is the need for the society to appreciate the role of the banking institutions to roll out programs that seek to improve the quality of their live through the formation of new products and services. One of the banks in Namibia that has made a great positive impact in both the lives of the citizens and the banking industry as a whole is Bank Windhoek. Despite the bank being home-grown, it has made various positive impacts in the banking industry in the country by rolling out new strategies that help in the improvement of the lives of the citizens which has also had a positive impact on the services of the bank (Amadhila and Ikhide, 2016, p84). In this relation, there is the need to appreciate the role of the bank in its attempt to introduce Senior Save Account that aims at providing tailored services to the aged in the population.

To examine the importance of the Senior Save Account that Bank Windhoek has rolled out to its clients, there is the need to examine Bank Windhoek and its relevance in the country (Housing, Delgado, and Luhl, 2016, p67). Bank Windhoek was established in the year 1982 with the local entrepreneurs who bought eight local branches of the Volkskas Bank to create an opportunity for Namibians to have a financial institution that is financially independent and focuses more on the need of the locals with the view of improving their financial success and prosperity in the country. Bank Windhoek is a commercial bank in the country and operates in the Namibian market; it carries out its business as a registered bank in the country through the provision of comprehensive services to clients. Moreover, the bank liaises with other international banking institutions and financial centers to provide international banking services in the country, the activities of the bank are certified by the Bank of Namibia, which is the regulator of the banking industry in Namibia (Kambwale and Chisoro, 2015, p80). Since its inception, the bank has had strong positive growth and gained a strong financial position in the country.

It is factual that the bank has had a positive growth in the country, and this apparent in the way it leads all financial services in the country. It is the only locally-owned bank in the country and is a flagship brand of Capricorn Investment Holdings (CIH) Limited; it is a wholly owned subsidiary of Bank Windhoek Holdings Limited where CIH has an interest of 72.9 percent (Taukeni, 2015, p416). The bank has been very successful in the market because of some factors among them being solid support structure that has been laid out, robust management, and advanced technology that is complemented by qualified staff. Moreover, the bank offers some financial services to the clients among them being business, personal, corporate, electronic and international banking services through having consortiums with other financial banking institutions (Randa, 2016, p9). Currently, the bank has a total of 50 branches and 234 automated teller machines (ATMs) to increase accessibility to financial services to the population. The widespread of the bank is due to the banks initiatives to roll out corporates social responsibility activities through Bank Windhoek Social Investment Fund. The fund has been of great importance in alleviating poverty in the society through distribution of funds for creating jobs, promoting education, and health (Desta, 2016, p12). Such is evident in that in the year 2009. The bank contributed a total of 6 million to the economy through the corporate social responsibility.

1.2 Research Problem

Competition is very stiff in the banking industry in Namibia proving the need for the financial institutions to be very innovative to capture the right market share. Some of the top banks in the country are such as The Bank Windhoek (BWK), Commercial Bank of Namibia (CBN), First National Bank of Namibia (FNB), and the Standard Bank of Namibia (SBN) (Shipulwa, 2016, p97). All the banks in the country have great ties with South Africa, and this is also true for Bank Windhoek in that although it is entirely based in Namibia, ABSA of South Africa has 36 percent shares in it. The high competition for the market calls for innovation in the banking industry requiring the banks to target a particular segment of the market. In this manner, Bank Windhoek has the strategy of capturing the market segment of senior citizens through the Senior Save Account. In this manner, the bank needs to formulate the right strategies that can be used to fulfill organizational objectives and ensure that the market share of the organization increases (Naimhwaka, 2015, p124).

In the process of rolling out the Senior Save Account, there is a need to examine internal structures of the bank, and specifically, the technological component of the same to streamline activities of the bank with the technological know-how thereof (de Waal, 2015, p24). Another issue that Bank Windhoek needs to put under consideration in its poor performance in the rural areas in Namibia, and this is apparent in the way it has a marginal market share or the rural market. Increasing market share of the senior citizens requires that the bank steps up its influence in the rural areas because it is the rural areas that have high numbers of senior citizens in the population. It is, therefore, apparent for the company to set out strategies that would enable the company to capture a large market share in the rural areas and increase its dominance in the rural areas (Heath-Brown, 2015, p869). Technology is another issue that proves to be a great influence as there is poor technological know-how among the elderly citizens thereby proving the need to enlighten the senior citizens in the rural areas for Senior Save Account to be successful.

The final issue that the bank seeks to address is the lack of an avenue that is tailored to the senior citizens that advocates for their rights and that can create a reprieve to the elderly. It is factual that the aged have a lower opportunity of making money and charging them the same amount with the rest of the population for banking services proves to be a way of discrimination to them. In this manner, it is prudent for the society to provide an avenue and offer a product that can benefit the elderly by providing a banking product that is cheaper for the elderly (Shoopala, 2015, p128). The high banking charges discourage the elderly from using or accessing financial services thereby making them cut out from the financial services in the society.

2. Focus for the Study

2.1 Purpose of the Study

The main aim of the research is to examine the need for the Senior Save Account and to help in highlighting the necessary infrastructure that need to be installed to make the initiative a success. It is apparent that this research is unique and the first of its kind to be started in the society with the view of targeting the elderly people in the society. Issues that this study seeks to examine are such as the required technology, means through which the bank would reach its customers, the efficiency and effectiveness of customer services, and the intended gains that The Bank Windhoek would have through the new product in the market. Another issue that would be of great importance for examination would be such as the strategies that the bank has laid out to reach out to the target customers. Such entails opening of new branches in the rural areas and stepping up promotional activities to make the product more sellable in the intended market. This study therefore seeks to market Senior Save Account in the society and examine the importance of the same with the view of sensitizing the population, and especially the elderly on this type of account so that they can get the services related to it.

2.2 Research Questions...