Zimpapers Logo

Africa Moyo, Harare Bureau

THE Reserve Bank of Zimbabwe (RBZ) has brought back cash-out transactions but capped it at $100 to ensure abuses of mobile money platforms are minimised.

The development comes after the RBZ had banned cash-in, cash-out and cash-back transactions on Monday.

It is expected that illegal foreign currency dealers would be discouraged by the move as they will be hit hard by transacting costs since it would take over two transactions to exchange US$10 for electronic money.

But sceptics say the decision to unban cash-out transactions will see enterprising mobile money agents using the cash-in system to circumvent the new measures.

RBZ Governor Dr John Mangudya yesterday said payment systems play an important role of providing an avenue to facilitate economic activities in the country. 

“As such, the Reserve Bank continues to promote digital financial services which contribute to financial inclusion and stability. Cognisance of that, enhanced monitoring mechanisms have been put in place by both the Reserve Bank and Payment System Providers to mitigate against abuse of payment systems and ensure abusers are brought to book.

“To this end, Payment System Providers and Agents are hereby advised that the cash-out facility is now capped at $100 per transaction with immediate effect,” he said.

Dr Mangudya said existing operational cash-in and cash-out limits remain in place, adding that the RBZ will be injecting cash into the economy “without changing money supply”. 

“In this regard, banks will exchange existing RTGS balances for cash thus maintaining the monetary base unchanged.

“Financial institutions and agents are required to strictly adhere to the Know-Your Customer (KYC)and Customer Due Diligence (CDD) principles for all their customers at all times and ensure that there is no abuse of the payment systems,” said Dr Mangudya.

The RBZ’s directive on cash-in, cash-out and cash-back facilities, saw the forex rate sliding to US$1:$14 by yesterday from a high of US$1:$26 a fortnight ago.

The directive was also meant to address the challenge of individuals who were selling cash for as high as 60 percent. 

While the ban on cash-in, cash-out and cash-back facilities had brought order on the market, it created a new crisis as commuters struggled to access cash for bus fare.

This saw commuter operators charging almost double the fare that was paid for in cash as they claimed that service stations were demanding cash payment for fuel.

National Business Council of Zimbabwe (NBCZ) president Mr Langton Mabhanga hailed the RBZ for the “swift response to public outcry and called on the central bank to punish EcoCash agents abusing the system.

“Capping cash-out at $100 and increasing cash supply to banks hedged by the existing RTGS balances will effectively increase cash in circulation. This will protect the transacting public who will be able to access cash.

“This will eclipse price skimming by the premium vultures and bring sanity in the financial services sector,” he said.

Mr Mabhanga said there was a need to ensure supermarkets and other businesses do not supply money to those involved in selling cash as has been the case in the past.