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Banks face ‘unprecedented’ liquidity crunch

Friday, March 07, 2025 | 2580 Views |
Engines of the economy: Small businesses are at the centre of economic activity in the country, but the liquidity crunch means their funding may be limited PIC: MORERI SEJAKGOMO
Engines of the economy: Small businesses are at the centre of economic activity in the country, but the liquidity crunch means their funding may be limited PIC: MORERI SEJAKGOMO

The local banking sector is facing an 'unprecedented' liquidity crisis that threatens to hamper the lending activities required for the private sector’s growth, BusinessWeek has established.

The Bank of Botswana (BoB) released about P1.8 billion to banks in December, as liquidity dried up in the market because of a slowdown in government spending related to the prolonged diamond slump.

The situation has not abated this year and could intensify as government digs deeper into the capital market for debt to finance the P22.1 billion deficit expected in the 2025–2026 financial year.

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Editor's Comment
The Boko-led administration has to tread carefully

‘When you make peace withyourself, you make peace with the world’- Maha GhosanandaThis may come at a huge cost if not handled properly. What started off on Labour Day in Letlhakane this year, where Boko was in attendance when the militant lawyer-cum-trade unionist, Robert Rabasimane rebutted the President’s address in defence of the trade union has seemingly spiralled out of control. The issue is now creating a cat-and-mouse type of a...

Mmegi Editor | 11 September 2026
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