RBZ abolishes multiple wallets: Here are the Highlights of the 2020 Mid Term Policy statement

by | Aug 21, 2020 | Business | 0 comments

The Reserve bank of Zimbabwe has issued the Mid Term Monetary Policy statement for 2020 which has set individual Ecocash transactions at $ 5000 a day while abolishing multiple money wallets with immediate effect, among other measures

Key highlights of new measures include:

-all export retention thresholds for all exporters will be at a standard level of 70% with immediate effect.

-the 30-day liquidation period of unused forex funds has been reviewed upwards to 60 days from the day of receipt of funds.

-With immediate effect and going forward, 20% of the foreign currency receipts of providers of goods and services shall be liquidated at the point of depositing in the Domestic FCAs.

-Activities of bureaux de change liberalized to enable them to enhance their business by increasing the exchange rate spread from the current 3.5% to up to 5.0% above the auction rate.

-The bureaux de change will be required to sell at the forex auction at their reserve price, 80% of their balances held every Monday.

-Mobile money transactions by individuals shall be pegged at ZW$5,000 per day with immediate effect

-Mobile money operators shall, with immediate effect, close all multiple wallets, and allow just one wallet per individual.

-Agents’ mobile money wallets are therefore abolished, with immediate effect

-Bulk payment wallets will be approved by regulatory authorities for limited use, primarily for low value transactions and humanitarian funds disbursements to vulnerable members of society

-Any other bulk payment transactions, such as payment of salaries and wages, should be processed through normal banking channels.

Notable developments:

-Bank’s monetary policy has fostered price and exchange rate stability through the introduction of a transparent foreign exchange auction system on 23 June 2020

-The resultant stability and predictability in the exchange rate is envisaged to help stabilise prices of goods and services. Consequently, annual blended inflation that stood at 485.27% is projected to taper-off over the remaining part of the year as inflationary pressures continue to ease.

-The country recorded a positive foreign currency net position of US$1.3 billion for the six months ending 30 June 2020, compared to a deficit of US$738.7 million for the same period in 2019.

-The Bank continued to support the productive sectors through its Medium Term Lending Facility to support banks with productive sector funding requirements. A total of ZW$2.6 billion had been disbursed to banks as at 30th June 2020.

-In response to the increasing demand for cash by the transacting public, the Bank introduced higher denominations of ZW$10 and ZW$20 in the banking system. In addition, the cash withdrawal limits were reviewed upwards from 12 ZW$300 to ZW$1000 per week to provide transactional convenience to the public-GreatDykeNews24

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