Tuesday, 31 May 2016

Zimbabwe banks cash in on crisis

DEPOSITORS continue to struggle to withdraw their money as the cash crisis escalates forcing banks to cap daily withdrawal limits to a maximum of $100. 

With payment of salaries for most workers and pensioners continuing this week, tensions have intensified between banks and their clients who are forced to spend hours on queues only to be given a fraction of their hard earned income.

Banks have also come under fire with depositors accusing them of taking advantage of the biting cash situation to milk them through “exorbitant” service and withdrawal charges from repeat withdrawals.

Some banks charge up to $20 a month service charge and up to $4 ATM charge per transaction. Last month banks had capped withdrawal limits between $200 and $500 per day.

A snap survey carried out by Chronicle in Bulawayo yesterday showed that some banks were restricting withdrawals to a maximum of $100 per day. At ZB Bank corner Jason Moyo and 8th Avenue, branch clients were only allowed to withdraw $100 from the bank’s Automated Teller Machine (ATM) while no withdrawal transactions were permitted in the banking hall.

An official at CBZ Bank 8th Avenue branch said their maximum withdrawal was $300 a day inside the banking hall and through the ATMs.

“Withdrawing from the ATM attracts a 0,6 percent charge while withdrawing from within the bank customers are charged 1 percent,” said the official.

At FBC the daily withdrawal limits yesterday was also pegged at $100.

Depositors have complained that the cash crisis was inconveniencing them as they are forced to spend more time on queues.

Another client at CABS Jason Moyo branch said the cash crisis has become a menace as the building society’s clients were forced to wake up as early as 4.AM to queue for withdrawals.

Since last month, the country has been experiencing cash shortages with the Reserve Bank of Zimbabwe attributing this to illicit financial flows, a huge trade deficit and lack of savings culture. The Central Bank plans to avert the cash crisis with the introduction of bond notes and promoting the uptake of foreign currencies alongside the United States dollar by August.

Finance Minister Patrick Chinamasa has said bond notes are not aimed at reintroducing the Zimbabwe dollar.

The bond notes will be backed by a $200 million Africa Export-Import Bank facility.

Reserve Bank governor John Mangudya has hinted that they have revised the introduction date of bond coins after noting that their production takes at least four months.

The bond notes which will be printed in Germany would circulate alongside the multicurrency system in denominations of $2, $5, $10, and $20.

As a stop gap measure to the cash crunch, Mangudya has said in the interim authorities would import additional cash and promote the full basket of currencies.

The monetary authorities have also encouraged the transacting public to intensify the use of plastic money to ease the cash shortages.

Source: zimnews

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