The publication of the 2025 Namibia Financial Inclusion Survey deserves recognition as an important milestone in the country’s economic development. It provides evidence that Namibia has made measurable progress in expanding access to formal financial services, digital payment platforms and banking infrastructure. More Namibians are financially connected today than at any point in the country’s history.

This achievement should be welcomed.

Financial inclusion is widely recognised as a critical component of modern economic development. It enables households to save securely, make payments efficiently, access credit, ensure against risk, and participate more fully in the formal economy. Countries that have successfully expanded financial inclusion have generally experienced stronger household financial resilience and greater participation in formal economic activity.

However, the survey also conveys a far more important message, one that extends well beyond banking.

It asks a fundamental question about the nature of economic development in Namibia: Can greater financial inclusion alone deliver broad-based prosperity?

The evidence suggests that it cannot.

While financial inclusion has increased from 78% in 2017 to 86% in 2025, a significant proportion of Namibian households remain severely financially vulnerable. According to the survey, 54.1% of income earners survive on N$2 000 or less per month, while only one-quarter reports that their salaries or wages last until the next payday.

These figures reveal an important distinction that policymakers, businesses and development practitioners should not overlook.

Access to financial services is not the same as financial security.

A household may possess a bank account, use mobile money, receive wages electronically and have access to formal financial products. Yet if income remains insufficient to meet basic living costs, those financial services cannot by themselves create economic wellbeing.

Indeed, one of the survey’s most revealing findings is that 43.2% of adults who remain outside the banking system report that they simply do not earn enough money to save.

This is not primarily a financial sector problem. It is an income problem. It is an employment problem. Ultimately, it is an economic growth problem.

The survey reinforces this conclusion. Nearly half of all borrowing is used to purchase food rather than productive assets, while more than two-thirds of adults remain uninsured because insurance premiums are unaffordable. These findings reflect households managing immediate survival rather than building wealth.

In their Nobel Prize-winning work, Poor Economics, Abhijit Banerjee and Esther Duflo demonstrate that financial instruments, including savings products, microfinance and access to credit, can improve household welfare. However, they also caution against viewing financial inclusion as a substitute for economic development itself. A bank account cannot create a job, and a loan cannot create customers where economic demand does not exist.

Namibia possesses many of the structural characteristics associated with long-term economic success, including political stability, strong institutions, prudent macroeconomic management and a sophisticated financial sector. It also stands before major opportunities in mining, agriculture, tourism, logistics, renewable energy, green hydrogen and the emerging oil and gas industry.

Economic growth, however, ultimately depends on productive investment. Investment creates employment, transfers technology, develops skills and expands productive capacity. Governments create the conditions for growth through sound policy, infrastructure and stable institutions. Businesses generate the overwhelming majority of jobs.

Namibia’s next development phase should therefore focus not only on expanding financial access but also on strengthening the productive economy. Policies that encourage enterprise development, enhance competitiveness, reduce unnecessary regulatory burdens, and attract responsible investment will ultimately improve household welfare far more sustainably than financial inclusion measures alone.

Housing illustrates this relationship clearly. Individuals purchase homes when they have secure employment and confidence in their future. Developers invest when demand exists. Construction companies employ workers, suppliers expand, and municipalities benefit from increased economic activity. Housing is therefore both a reflection of prosperity and a driver of further growth.

The Namibia Financial Inclusion Survey should be viewed not merely as a banking report but as an assessment of Namibia’s wider economic condition. Financial inclusion creates opportunity. Economic growth enables citizens to seize that opportunity.

Ultimately, Namibia’s success should not be measured solely by the number of people with bank accounts. It should be measured by the number who secure meaningful employment, build successful businesses, own homes, accumulate assets, and believe that their future can be built in Namibia.Financial inclusion remains an essential pillar of development. It is not the destination.

It is the bridge. The destination is an economy that generates opportunity, rewards enterprise and delivers inclusive and sustainable prosperity.

*Oliver Scheidt is the Chief Executive Officer of The Strategic Economy.

*Lorenzo Brussel is a Director at LGL Investments.