Person-to-person e-money transfers of $1.8 billion as at 30 June 2024, 87 per cent population with active mobile money accounts as at December 2023, percentage of adult population making or receiving digital payments other than mobile money in 2023 at 45.4 per cent, currency in circulation as at 31 July 2024 at $1.1billion and inward personal remittances increasing by 8.8 per cent to $1.2billion in the 2023-2024 financial year, an increase of 23.2 per cent from the previous are some of the key data presented in the Reserve Bank of Fiji August 2023-July 2024 annual report that was released this week.
THE RBF Governor Ariff Ali states in the report the Fijian economy exhibited resilience in dealing with ongoing risks stemming from restrictive monetary policy in its trading partner economies and the escalation of inflationary pressures from both domestic and international factors. He said after registering a record-high growth of 19.8 per cent in 2022, followed by a 7.5 per cent expansion last year, the domestic economy growth is projected to grow for the third consecutive year in 2024. He adds this is at a slower pace, stating the positive economic activity is driven by a robust tourism sector, supported by an increase in Government expenditure and historically low rates in the financial sector.
The commercial banking industry
RBF reports prudential assessment of the commercial banking industry’s capital, earnings and liquidity positions were satisfactory, with asset quality indicators rated as marginal as of June 30 2024. RBF reports total assets of the commercial banks grew over the year by 5 per cent to $14.8billion as of 30 June 2024, underpinned by the increase in loans and advances by $974.9million, and balances due from banks by $109.6million. Commercial banks’ loans and advances continued with its growth momentum conducive to the Fijian economy’s recovery, increasing over 12 months by 11.8 per cent to $9.3billion, said the RBF. The majority of the commercial banks’ lending were to the private individuals’ sector at 27.6 per cent, followed by wholesale, retail, hotels and restaurants, and real estate sectors at 22.4 per cent and 19.8 per cent, respectively. The RBF states total deposits of the commercial banks’ rose by 7.4 per cent to $11.6billion over the 2023-2024 period, attributed to demand and time deposits which grew by $0.5billion and $0.3billion, respectively.
Credit institutions
The RBF reports performance indicators of the credit institutions industry were satisfactory for capital, earnings and liquidity positions, while asset quality was rated as poor. Credit institutions industry’s total assets grew annually by 4.3 per cent to $777.6million as at June 2024, mainly attributed to the $58.5million increase in loans and advances, while decreases were noted in balance due from banks by $35.5million and fixed assets by $10.7million. The RBF adds the growth in loans and advances to $561.9million was largely driven by the private individuals, professional and business services, and wholesale, retail, hotels and restaurants sectors. Credit institutions’ balance due from banks, on the other hand, reported a reduction of 21.3 per cent when compared to the same period in 2023, to $130.8million, said the RBF. Total deposits of the credit institutions increased by 7.1 per cent over 12 months, to $447.2million.
Payment service providers
The RBF states the uptake and usage of digital payment platforms in Fiji remains promising, driven by technology advancements and an increase in consumer demand for convenient, efficient and accessible financial solutions. The RBF added this is supported by the high volume of inward remittances. As of June 30 2024, the total value of electronic money (e-money) in circulation was reported at $94.8million (June 2023: $80.1m), with an average of $97.4million in circulation on a monthly basis during the 12-month period. RBF adds while the number of registered e-money accounts declined by 0.3 per cent to 945,390 in June 2024 compared to the same period last year, the number of active e-money users increased from 454,092 in June 2023 to 655,493. Person-to-person (P2P) transfers significantly increased by 56.1 per cent over the 12-month period, to $1.8billion as of June 30 2024.
E-money platforms
The RBF states the increase in the usage of e-money platforms indicate the general shift in behaviour of consumers towards digital financial services largely due to its convenience and accessibility. International inward remittances via e-money platforms stood at $551.2million as of June 30 2024, increasing by 36.6 per cent (or $147.8m) over the year, largely supported by the increase in the volume of inward remittances from Australia, the United States of America, New Zealand and the United Kingdom. Total transactions acquired via payment service providers payment platforms increased by 151 per cent to $550.5million as of June 30 2024, said the RBF. The significant increase in the volume of acquired transactions indicate local businesses’ uptake of payment service providers payment platforms as a means for accepting payment transactions. The RBF states the Fijian Government’s regulated public transport fare payment system, e-Transport, continues to operate on Vodafone Fiji’s M-PAiSA platform. Aggregate value of top-up transactions for the 12-month period ending June 30, 2024 was reported at $292.4million, declining by 17.1 per cent from $352.6million worth of top-up transactions recorded in the same period last year.
Currency in circulation
The RBF states as of July 31 2024, total currency in circulation stood at just above $1billion. The value of notes in circulation increased by 4.4 per cent to $982.8million during the financial year, with the $5, $10 and $100 denominations being the highest circulated notes. The value of coins in circulation increased by 6.3 per cent to $78.9million during the financial year. The $2 and $1 coins registered a growth of 7.7 per cent to $23.8million and 7.4 per cent to $20.3million, respectively.
The RBF states for the financial year ended July 31 2024, the value of currency issued to commercial banks was $1,118.4million, of which $1,112.4million was in notes and $6million in coins. The RBF adds the $100 and $50 notes issued continued to be the highest in value, driven by its increasing usage in automated teller machines. The $2 and $1 coins issued continued to be the highest in value, reflecting the shift in public demand from low to high-value coins.
