RBZ urged to scrap withdrawal limits

24 Mar, 2017 - 00:03 0 Views
RBZ urged to scrap withdrawal limits Dr Jinya

The ManicaPost

The Bankers Association of Zimbabwe (BAZ) says the central bank should scrap withdrawal limits and allow financial institutions to determine the amounts that they give their clients depending on available cash.

Withdrawal limits have always been the norm in the market but they have  become a bone of contention due to cash shortages that the country has experienced for about two years. The shortages forced Government to introduce “bond notes” which are  officially of equal value to the United States dollar”, the main currency  used for transactions in Zimbabwe since adoption of multiple foreign currency system in 2009.

Despite introduction of the bond notes, the shortages have however persisted and have been blamed on externalisation of the much sort after green back and low exports.

Withdrawal limits are pegged at $1 000 and $10 000 per day for  individuals and corporates respectively but have gradually gone down to  as little as $60 per individual and $500 for a company depending the  amounts that the banks have in their vaults. In some cases, clients are forced to walk away empty handed as banks  claim they have run out of cash. But BAZ president, Dr Charity Jinya said the continued acknowledgment  and use of the limits by the Reserve Bank created a “crisis of  expectation.”

“We would rather have them (limits) removed so that each bank uses its  knowledge of the client, their requirement and what is available on a  day to day basis to issue it,” she said recently.

Dr Jinya said indications that bank notes had higher value than plastic  money meant that the demand for cash would remain high.

“The market should be encouraged to make greater use of e-channels as opposed to making greater use of cash,” she said.

She said some banks had since introduced weekly withdrawal limits while  others were not able to do so for a variety of reasons. Ideally, every bank would like to have weekly limits for technical  reasons. It is taking time for some and for others, for liquidity reasons they may have difficulty (introducing weekly limits) but we  would like to make sure our clients do not trek to banks every day,” she said.

Some banks have set the weekly withdrawal limits of $300. — New Ziana.

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