Zimbabwe’s is finally making the switch to e-passports after more than 20 years when the technology was first deployed in Malaysia in 1998. I and many others don’t have too much of an issue with the change from a security standpoint. Zimbabweans will be able to access Automated Border Control terminals and home and abroad. The smart travel documents will also afford us security measures far above what we have now but there is one big problem… Why was CBZ the only bank graced with the honour of accepting application fees for the new e-passports?
“A normal fee of $20 shall be charged for the application fee through CBZ bank countrywide,”SI 273 of 2021
I have nothing against CBZ but from the perspective of convenience for the public surely this facility should have been extended to all banks in the land. We are all too familiar with how packed banks are these days, just last week civil servants queued en masse to get their bonuses.
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Now imagine what it will be like when the rush for application fees for e-passports happens because for whatever reason Zimbos like to do things last minute (myself included). Add on to this the pandemic and we have a serious problem…
Zim banks are now just transaction fee machines
If there is something that we as Zimbabweans have had to contend with are the ever-increasing fees to store our money and transact. Now, this isn’t the fault of the banks because, traditionally, banks should generate the majority of their revenue from interest generating sources like mortgages, loans and the likes. In Zimbabwe, the economic situation is a little different because the banks are, in large part, credit shy because of defaulters, hence they must make their money at the point of transaction and service charges.
This peculiar phenomenon was noted by the Reserve Bank of Zimbabwe’s Banking Sector Report for the Quarter Ending September 2021
“During the period under review, interest income from loans and advances contributed 41.16% of the total income , an improvement from 16.29% of total income in reported in 2020. This indicates that the sector is shifting towards the traditional sources of revenue such as income from activities, which are financial intermediation considered stable and less vulnerable to changes in economic conditions and exchange rate movements.”RBZ
Whatever operation a bank is set to do has a fee from balance enquiry all the way to an insufficient funds error (prepaid USD). What I am getting at is that CBZ is most likely not doing this for free, especially considering that foreign currency is involved with the e-passport applications.
This brings about three points/questions:
- Was there a selection process for which individual bank would be suited to this?
- What criteria did CBZ alone meet that the others didn’t?
- Was the pandemic factored into this?
Lastly, the exclusionary nature of this decision viewed from a banking perspective is detrimental because it concentrates whatever proceeds gained just to one institution. How then are the other banks supposed to make money that they could otherwise use for reserves or improvements?
You should also read
- Everything you need to know about Zim’s new e-passport
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- How do Zimbabwe’s prepaid US$ card fees stack up against one another?
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- Here’s how much your bank charges for all ZWL$ account transactions & services