National Strategy for Financial Inclusion II 2024 – 2028.

The National Strategy for Financial Inclusion II is a cross-sectoral framework aimed at deepening the usage and impact of financial inclusion by expanding access to growth- and resilience-oriented financial services, strengthening digital financial ecosystems, addressing remaining rural access gaps, and improving financial literacy, consumer protection, and trust in the financial system. The Strategy was developed following a review of the progress achieved under the previous National Financial Inclusion Strategy 2017–2021 (NFIS I). Its preparation was facilitated by the Government of Lesotho with support from the Southern African Development Community (SADC) Secretariat and the European Union. To achieve its objectives the NFIS II proposes a two prong strategic approach (1) a focus on the productivity and resilience of MSMEs and farmers, including to climatic shocks and (2) promoting digitization and innovation to enable the private sector and government to deliver a wide range of affordable products and services to achieve the Vision of a dynamic, inclusive financial sector that enables all Basotho individuals and businesses to access and use the financial and non-financial services they need to contribute to inclusive national growth, their well-being and resilience, and a sustainable future.
The NFIS II strategic priorities cover demand, supply, regulatory, and coordination aspects of financial inclusion as follows (1) enhance financial literacy, consumer protection, and digital risk management to build trust in the financial system through improved education, stronger regulation, and enhanced cybersecurity and data protection; (2) develop targeted financial products and mechanisms for MSMEs and smallholder farmers to expand access to credit and insurance, strengthen productive capacity, and support inclusive growth through improved market access, digitization, development finance institutions, credit guarantees, capital markets, and simplified compliance, with a focus on gender, youth, agriculture, and climate resilience; (3) promote digital adoption and usage of financial services by improving payment system interoperability, advancing digital infrastructure and legislation, expanding rural connectivity, and supporting e-government, cross-border payments, and merchant acceptance, while strengthening digital insurance, pensions, and micro-insurance frameworks; (4) strengthen the enabling environment and coordination of financial inclusion by enhancing innovation through regulatory sandboxes, open finance and data systems, improving digital identity and fintech regulation, strengthening supervision of cooperatives and MFIs, and reinforcing governance, institutional capacity, and data-driven coordination across the financial sector.