Our prediction that the irrational ban on cash-in and cash-out for mobile transactions would make things worse has just been confirmed. The price of cash on the streets has just gone up. This is one of the times when one is actually sad that they were right.
According to a survey done by ZimPriceCheck, the cost of acquiring cash on the streets of Harare has more than doubled. Where the rogue EcoCash agents were charging a 35% premium and 40% premium for coins and notes respectively, they are now charging 80% for coins and 100% for notes.
It was obvious
It baffles me why the RBZ made their proclamation when the result was so obvious. Cash sellers weren’t gonna stop but rather they were gonna capitalise on the increased scarcity of money or the perceived increased scarcity. Any economist could see that happening from a mile off except the economists at our central bank.
It’s much worse now
The other reason why cash is now fetching such a premium now is that a lot of businesses especially smaller ones and informal ones have stopped accepting EcoCash since the RBZ ban. No one wants to be left stuck with money in their EcoCash wallet which they can’t move around as they please. That insistence on cash has increased the demand for cash further and people are actually lining up for cash on the streets at those high premiums.
This is immoral
John Mangudya and his bank has again reduced the spending power for millions of people at the stroke of a pen. The only word I can think of to describe this is immoral.