The Bank of Zambia plans to introduce a minimum capital requirement for businesses that are engaged in mobile money transfer services in the Southern African country.

This means any company that wants to begin operating or continue to operate digital money transfer services has to have a capital base equal to-or above the rate set by the Bank of Zambia.

Francis Chipimo, Bank of Zambia Director for Economics, said the institution has, until now, avoided implementing this requirement in order to promote financial inclusion in the country.

However, with the advent of mobile transfer services and more locals using these services, the minimum capital requirement is required to enhance the growth of the sector, he said.

Last week, the Minister of Finance and National Planning Alexander Chikwanda revealed that the country's unbanked population has been reduced from 62% to 42%, mainly due to mobile money services.

A 2015 FinScope report on financial inclusion in Zambia showed that 59.3% of adults are now financially included.

Chipimo could not confirm the rate at which the minimum requirement would be set or when the regulation will come into effect, and said only that they are "working on measures" to finalise arrangements.

Cash4Zambia manager Albert Sakala described the development as "good" and said it would help companies to expand their services. "The minimum capital requirement will help companies involved in electronic money transfer services to become stable financially in addition to providing opportunities for meaningful support to the real growth in the sector."

It is understood that companies that fail to meet the minimum requirement will be forced to close.