Banks sab­o­tag­ing econ­omy

Chronicle (Zimbabwe) - - National News -

ED­I­TOR — Banks and mi­cro fi­nance in­sti­tu­tions have been fleec­ing this econ­omy in charg­ing rates that bor­der on eco­nomic sab­o­tage.

I have al­ways won­dered why we have not taken ac­tion on this ob­vi­ous short­com­ing that has dec­i­mated our pro­duc­tive sec­tors.

In­di­vid­u­als have not been spared and the abil­ity to save has been se­verely af­fected by these banks and mi­cro fi­nance in­sti­tu­tions.

That the Re­serve Bank of Zim­babwe has not acted de­ci­sively on this is very sur­pris­ing. Our rate of in­fla­tion is around -3 per­cent yet we charge in­ter­est rates well above 10 per­cent.That alone speaks vol­umes about the reck­less­ness preva­lent in the fi­nan­cial ser­vices sec­tor.

We are us­ing a mul­ti­c­ur­rency sys­tem which is strong and sta­ble.

In fact the cur­rency in use has been strength­en­ing against both lo­cal and re­gional cur­ren­cies and there is there­fore a strong case for an­nual rates well be­low 10 per­cent even if one were to fac­tor in coun­try risk.

What has been hap­pen­ing is that we have been see­ing prof­its be­ing de­clared in the fi­nan­cial ser­vices sec­tor when the rest of the econ­omy has been suf­fer­ing.

Some com­pa­nies have in fact shut down be­cause they have failed to ser­vice the ex­pen­sive debt. Who then is the en­emy of the state? Isa­iah Jemwa, Harare

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