Africa Financial Sector Responses to COVID-19 - Botswana

Jul 28, 2020

As a Partnership committed to the African financial sector (AFS) development and resilience, Making Finance Work for Africa (MFW4A) has implemented a number of recent initiatives to strengthen the resilience of the African financial sector.

In addition to its webinars series and discussions aimed at identifying the sector's difficulties and solutions, a portal dedicated to domestic and international responses to the impact of COVID-19 on the regional financial sector has been set up.  The exercise consists in monitoring, collecting and classifying by country or region the measures taken by governments, central banks and DFIs in in support of the AFS vis-à-vis the financial impact of the pandemic. 

This page presents measures and initiatives by the government of Botswana, national central bank and Development Finance Institutions (DFIs) in support of a resilient domestic financial sector facing the effects of the COVID-19 pandemic.

Disclaimer: This page contains information and links from third parties. These links are being provided as a convenience and for informational purposes only; they do not constitute an endorsement or an approval by MFW4A.

Instrument

Institution

Financing volume

Description

 Tax relief

 Government

N/A

(March 31, 2020) The Government of Botswana has published a series of measures on taxes for businesses affected by the pandemic: 
* VAT credit refund on VAT returns will be processed within 21 days instead of the usual 60 days for small businesses; 
* Larger businesses, above Botswana Pula (BWP) 250 million annual turnover, will have to apply for a similar speedy credit repayment.
*Deferral of 75% of any two self-assessment tax quarterly payments due between March and September 2020, with payment of the deferrals to begin from March 2021.

Rules and regulation

Central Bank of Botswana

N/A

(April 01, 2020) Regulatory forbearance in relation to assessment of non-performing loans and determination of expected credit losses, while allowing the granting by banks of moratoria on loans with a good repayment history for up to six months and the offer to restructure loans.

Loan gurantee Government USD 86 million (April 02, 2020) Government loan guarantees for 24 months total amount of Botswana Pula (BWP) 1 billion are available to private sector businesses. The guarantee is provided by Botswana export credit insurance (BECI) on behalf of the government. BECI will guarantee 80% of the loan, with 20% guaranteed by commercial banks.

Monetary policy

Central Bank of Botswana

N/A

(April 30, 2020) The Bank of Botswana decided to reduce the bank rate by 50 basis points from 4.75% to 4.25%.

Support fund / guarantee

Government

USD 171 million

(May 20, 2020) Economic stimulus measures: The Government is setting up a COVID-19 Pandemic Relief Fund into which it will inject Botswana Pula (BWP) 2 billion. The private sector is called upon to contribute to the Fund.