Mbabane – The Ministry of Commerce, Industry and Trade is working with the German Cooperative Raiffeisen Confederation (DGRV) to establish Eswatini’s first national cooperative bank, a move expected to transform the country’s financial landscape and promote inclusion across the cooperative sector.
Speaking to Eswatini TV, DGRV Director Fernando Espinoza said the ongoing feasibility study is assessing the country’s readiness to form a financial institution owned and managed by cooperatives themselves. The proposed bank is projected to handle assets of over E3.5 billion and would provide tailor-made financial products for the cooperative movement.
Espinoza explained that the study examines several aspects including governance structures, liquidity, financial health, and member participation across cooperatives. He noted that while some are well-managed and financially sound, others still need substantial support in record-keeping, management, and capital mobilisation.
Preliminary findings show that about 20 to 30 percent of cooperatives in Eswatini currently meet the minimum operational standards. Another 40 percent are considered capable of joining once they receive additional training and capacity-building support. DGRV has been working closely with the ministry to provide technical assistance, training, and digitalisation programmes aimed at strengthening weaker cooperatives.
Espinoza identified governance, member engagement, and financial discipline as the main challenges facing local cooperatives — issues that are not unique to Eswatini but common across the region. To address these, he said the development of the cooperative bank will be rolled out in phases, beginning with the country’s larger and more stable cooperatives before gradually including others.
He also pointed to the need for a clear regulatory and legal framework that would ensure accountability and effective supervision. DGRV is collaborating with the Central Bank of Eswatini and the Financial Services Regulatory Authority to align the bank’s establishment with national financial laws and ensure proper licensing.
Espinoza said the proposed bank will operate under category C of the national banking act, which supports rural development and financial inclusion. The required start-up capital is expected to range between E8 million and E15 million, with several local cooperatives already showing willingness to contribute.
Drawing on lessons from countries such as Kenya, Tanzania, Ethiopia, India, Brazil, and Ecuador, Espinoza noted that Eswatini’s cooperative bank would not simply replicate existing models but instead develop a system rooted in local culture, needs, and traditions.
He added that one of the biggest lessons from past cooperative failures is the risk of fragmentation within the sector. He called for a unified voice and shared code of conduct to ensure integrity, transparency, and sustainable growth.
Espinoza described the timing of the initiative as ideal, citing strong political support and momentum from both government and the cooperative movement. He said the bank’s success will depend on continued collaboration, sound governance, and active participation from members.
“The cooperative bank will be created by the movement, for the movement, and with the movement,” he said. “It represents a crucial step toward financial inclusion, ensuring that ordinary emaSwati gain access to essential financial services while reinvesting wealth back into the cooperative sector.”
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