By Conrad Mwanawashe
THE new Reserve Bank of Zimbabwe Governor, Dr John Mushayavanhu, does not want farmers to lose their savings through exorbitant bank charges.
In that regard, Dr Mushayavanhu, while announcing his maiden Monetary Policy Statement, Friday, said that he had already directed all banks to stop charging monthly bank maintenance or service charges for individual bank accounts.
“There has been an outcry as far as bank charges are concerned. We cannot continue to have a situation where a tobacco farmer from Chendambuya sells their tobacco and leaves maybe US$100 in the account and by the time they come back next season the money is now minus US$100 (the account is now in the negative).
What happened to the US$100?
“At least if you leave your US$100 in your account you should be able to find it in your account beginning next season.
“Banks will not charge monthly bank maintenance or service charges for individual bank accounts with a conservative daily balance of US$100 and below or its equivalent in ZiG for a period of up to 30 days,” said Dr Mushayavanhu.
Under Dr Mushayavanhu, the Reserve Bank will not engage in quasi fiscal activities.
“I don’t believe in quasi fiscal activities. It’s not going to happen under my watch. My mandate as spelt out in the Reserve Bank Act is very clear and I’ve no intention whatsoever to do other people’s jobs. I’ll do my job as the Central Bank Governor as defined in the Act. In that respect, we’ve moved all quasi-fiscal obligations to Treasury in an effort to clean the balance sheet of the central bank,” said Dr Mushayavanhu.
Dr Mushayavanhu also announced a new currency for Zimbabwe known as the Zimbabwe Gold or ZiG.
He said the current Zimbabwe dollar balances will be converted into the new currency.
ZiG will come in denominations made up of 1ZiG, 2ZiG, 5ZiG, 10ZiG, 20Zig, 50ZiG, 100ZiG, and 200ZiG distributed through the normal banking channels.
The coins shall be introduced in due course.
ZiG shall be anchored and fully backed by a composite basket of reserves comprising foreign currency and precious metals (mainly gold), received by the central bank as part of in-kind royalties and kept in the vaults of the central bank.
“With effect from 5 April 2024, banks shall convert the current Zimbabwe dollar balances into the new currency which shall be called Zimbabwe Gold (ZiG) to foster simplicity, certainty, and predictability in monetary and financial affairs. The new currency will co-circulate with other foreign currencies in the economy,” said Dr Mushayavanhu.
On conversion of all current ZW$ balances, banks are directed to rename all the current ZW$ accounts as ZiG accounts. Gold-backed Digital Token (GBDT) accounts will no longer be called ZiG accounts but will be known as GBDT accounts.
All ZW$ notes and coins held by account holders will be credited into their ZiG accounts using the applicable conversion factor. The banks will continue to accept these deposits for a period of 21 days after 5 April 2024.
“The Reserve Bank has made special arrangements for those without bank accounts to swap their ZW$ notes and coins at POSB and AFC Commercial Bank within 21 days after 5 April 2024. In instances where the cash holding to be exchanged is above ZW$100,000, banks shall apply the requisite know your customer (KYC) and Customer Due Diligence (CDD) principles,” Dr Mushayavanhu added.
Banks will now also be forced to pay interest on deposits.
