Challenges faced by the Banking Sector in tapping the untapped Informal Sector Market in Zimbabwe

This study assesses the challenges faced by the banking sector in tapping the untapped informal sector market in Zimbabwe. The research focused on the period between 2012 and 2016 where the challenges faced by the banking sector in tapping the untapped informal sector market in Zimbabwe were evaluated. The research aimed at analysing challenges faced by the banking sector in tapping the untapped informal sector market, unveil strategies that were being employed by the banking sector in addressing the afore mentioned challenges and to explore possible strategies to conquer the challenges The study used both questionnaires and interviews which were designed and administered to the banks personnel and SMEs. A response rate was 84% questionnaires and interviews were also administered to SME organisations where a reasonable response rate of was achieved. The results reveal that the major deterrence for banks to achieve targets were absence of lender of last resort and inter-market borrowing. From the informal sector per se it was mainly due to challenges associated with dealing with members of the sector. The research concludes that banks need to improve their fir specific attributes in order to improve their performance in the current complex environment and attract informal sector clientele to do business with them. The study recommends partnership between banks and informal sector in order to tap the unbanked money.