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RBZ says its illegal to send yourself money, but is that a justifiable position by the regulator?

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The Reserve Bank of Zimbabwe has seemingly caught on to “fraudulent activities” being conducted by Zimbabweans who are taking advantage of its Diaspora Remittances Incentives Scheme (DRIS).

The DRIS was put in place to attract the diaspora to send money through official channels by offering up to 5% interest on the amount sent, 2% would go to the remittance service (The Western Union, Mukuru etc) and 3% would go to the final receiver. Now the RBZ is claiming that there are some fraudulent individuals sending money to themselves.

Apparently, these individuals are using their local or international VISA/MasterCard to withdraw money in neighbouring countries then sending themselves money through remittance services and in the process earning the extra 3% DRIS incentive an act the RBZ believes to be fraudulent.

Speaking at a Bond Notes Awareness Campaign, RBZ Deputy Director for Financial Markets William Manhimanzi made the following comments:

We are aware that such fraudulent activities have been happening and we are quite informed that those people involved have not been doing it in far away countries like United States America but they were using countries like Botswana and South Africa, our neighbours.
We are monitoring the situation and we are currently working on finding the right mechanisms to curb these fraudulent activities because that is corruption and something must be done.
Now, this is interesting, we had no idea sending money to yourself from outside the country was a fraudulent or illegal activity?
We thought the point was to bring in foreign currency so if someone is doing the country a favour by remitting forex to themselves does that justify being called a fraudster? The RBZ created this loophole and now want to label and threaten people taking advantage of it, would they rather the person bring it in as cash and then trade it on the black market?
It seems the RBZ may be confused about what they are actually trying to achieve or just don’t like the thought of normal local citizens benefitting from something they put in place.
We have contacted a few remittance services and await their position of whether such acts are actually illegal or not.

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7 thoughts on “RBZ says its illegal to send yourself money, but is that a justifiable position by the regulator?

  1. The shot themselves in the foot somehow for sure… U can imagine Telecash is actually offering a 10% bonus (way better than the 3%) if you receive outside remittances via their platform. I wonder how they are going to stop this coz there are so many ways of ensuring that its not obvious that you are sending yourself money (even if a legal instrument is created against sending oneself money).

  2. RBZ has provided an opportunity for opportunists to make easy money. One only needs a couple of VISA/Master cards, say 5 of them. One then withdraws say $1,000 per card in Botswana, send the $5,000 to Zim and earn $150.00 cool bonus, next month go to Botswana again to withdraw the cash and do the same thing. One incurs transport costs only, which will be less than $50.00 anyway. Our economists are providing us with means to make money with no production at all. We call it empowerment!

    1. Local banks are charging as much as 5% for MasterCard withdrawals. Hence if you withdraw $500 in Botswana, you will be charged $25 assuming your MasterCard was issued by an local bank.
      Even given your overly optimistic estimates, you aren’t taking into account accommodation costs of staying in “Botswana” as you withdraw.
      NB The withdrawal limits set by your bank still apply even if you’re using your card in another country

  3. That’s very poor thinking. The bank/MTA charges on withdrawing and send that money will greatly exceed the 5% incentive.

    1. Ohh poor thinking? Then why are RBZ officials worried? One is charged less than $10 for withdrawing $1,000 in a foreign country. Add all the costs that you may think about and you realize one can still earn a profit from this. People have already started doing this and the RBZ is now crying fraud.

      1. It doesn’t make sense – at least with Western Union. Their commission alone is more than the 3% you will get from DRIS

      2. Consider that there aren’t any banks that don’t have stringent withdrawal limits on their Visa/MasterCards anymore. There’s effectively a general limit of $100 cash per day.

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