5 percent diaspora incentive already in place
Bond notes out in two weeks
BOND notes are now ready and will be released into the market in two weeks’ time as part of the export incentive that is meant to reward exporters and ease cash shortages.
The bond notes are being introduced as part of a facility to reward exporters a bonus of five percent of total exports receipts, which would be credited to the exporters’ local bank accounts. The latest development comes as the central bank is already running almost a similar incentive for Diaspora remittances where it is crediting five percent of the value of the money sent to Zimbabwe.
In a telephone interview yesterday, RBZ Governor Dr John Mangudya said under the Diaspora remittance incentive, those receiving money from outside the country were getting an extra three percent of the money sent while the transfer agent was getting two percent.
“This means that above the amount you receive, RBZ tops up with three percent while the money transfer agent gets two percent,” he said.
It means that for example if a relative abroad remits $1 000, the person who would get the money in Zimbabwe would withdraw it as $1 030 while the agent will receive $20. On the much talked about bond notes, Dr Mangudya said the notes were ready and everything was now in place for them to go through the normal banking and financial channels.
“The bond notes and its specimen will be released at the same time which is at the end of this month and will go through the banking system just like what we did with the bond coins. When I do things I don’t do things for myself but I do things for the good of the economy not to destabilise it. People must know that world over the currency is anchored on production and it has to be the same with us,” Dr Mangudya said.
The central bank says at least $75 million worth of bond notes would be in circulation by December but would only be issued in smaller denominations to allay public skepticism.
“We are building the country and we need to work together as Zimbabweans to ensure that people embrace the bond notes,” he said.
Dr Mangudya said people must know that the bond notes were not being introduced to replace the basket of multi-currencies that are being used in the country.
“The multi-currencies are here to stay. We are not replacing them. People should not panic because we are not going to replace the foreign currencies with the bond notes,” he said.
Meanwhile, his deputy, Dr Khuphukile Mlambo said contrary to reports that there were panic withdrawals triggered by the impending introduction of bonds notes, the figures show that bank balances have always been constant at around $6 billion.
“There are reports of panic withdrawals but we don’t see it because when we look at the deposits in banks we are still at around $6 billion. There is no need for people to be sceptical about the bond notes, they will certainly get used to it just like they did with the bond coins,” said Dr Mlambo.
He said the queues that were being experienced at some banks were synonymous with month end salary withdrawals.
Some banks have been failing to cope with cash demands from the public resulting in the financial institutions limiting withdrawals per day to as low as $50.
In some instances some of the banks have run out of cash. The situation is mostly dire during month ends when people are trying to access their salaries. Zimbabwe has been experiencing shortage of money resulting in the central bank encouraging people to use plastic money. The cash shortages has been blamed on some people who are externalising money.
The central bank earlier this year said $1,8 billion was externalised in 2015, a development that worsened Zimbabwe’s liquidity challenges. That necessitated stringent measures that included restrictions on the amount of cash that can be taken out of the country at any given time to $1 000 per individual.