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#Economy

Perm Sec In Ministry Of Finance Says Separation Of FCA/RTGS Accounts Was Done To Protect Exporters & Remittances

Zimbabwe bond notes and USD
   

The separation of foreign currency accounts and real time gross settlement accounts came as quite the surprise to most of us. For years we had been told that bond notes and USD’s are equal but on the ground no one bought into the pipedream and because that was the case USD supply dried up whilst bond notes where still available and thus the Reserve Bank had to take some actions; one of which is the separation of foreign currency and RTGS accounts.

The Economic Development Permanent Secretary George Guvamatanga spoke on why the banks had to take this route and essentially he attributed the switch to foreign currency ending up in the wrong hands due to banks being greed:

The separation of FCA accounts and RTGS accounts was necessary as the singular system was now disadvantaging those with access to free funds, such as NGOs, exporters and those who receive money from the Diaspora. If you receive $200 you shouldn’t be forced to rush to spend it because there is nowhere else to keep it or keep it under your pillow because there is no separation. So to protect those with access to such funds, it was very important to separate so that there is no confusion…

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Guvamatanga also pointed to banks who were using some underhand tactics in order to get some of the foreign currency that was coming into the country.

… and I know – I come from the banking sector. In the past, if you received money from the diaspora or from whatever source some banks would tell you that you can now access 70% of your money because the Reserve Bank said we should take the other 30%, which was not true.

So there was an element of market indiscipline that was now starting to creep in and discouraging those with access to US dollars from bringing it into the formal system and we were trying to address that matter by saying let’s separate the accounts under the multi-currency system which is still Government policy as we speak.

The government needs to do more in terms of communication…

When the policy was implemented none of this was made clear and I’m sure if the government had led with this, they would have had some people who empathise with them. When the instruction was given it did sound like an ultimatum to banks and judging from the Permanent Secretaries words that seems to have been the case.

Instead, we had a situation where they just announced a new system and people thought they were being fleeced once again. For those who get foreign funds, it is now on record that banks and other financial institutions should not hold any percentage of your forex using the claims that they were under central bank directives! Very important information and something worth spreading if you know people receiving money from outside the country and exporters.


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