Thursday, 8 September 2016

NO CASH DEPOSIT, NO FUEL PURCHASE : RBZ

IN  a bid to ensure cash flows back into the system, the Reserve Bank of Zimbabwe (RBZ) has directed banks to apply the matching principle when processing foreign payments.  This means that bankers will process fuel and crude oil payments for cash depositing companies by matching the cash deposits with cross border transfers on a ratio of 1:1.

  According to an Exchange Control circular from RBZ, the move is an interim measure. 
“Authorized dealers are advised, with immediate effect, to process fuel payment transactions for cash depositing fuel companies by matching, as an interim measure, the cash deposits with cross body transfers on a ratio of 1:1,” reads the exchange control circular no. 5 of 2016.
 
The same also applies to manufacturers of cooking oil.  However, some of the banks had already been doing this for most of their importing clients even for those who are not in the top priority.
 
“Furthermore, authorized dealers are encouraged to continue availing funds for fuel and edible crude oil in terms of the existing Priority List guideline for non-cash depositing companies.”
 
Both fuel and soya crude oil payments are in the Exchange Control Priority List 1.
 

The RBZ also said that banks are now required to declare all cash deposits made by fuel and crude oil importing companies.
 
Meanwhile, according to the RBZ monthly review for June, cash transactions declined 25 percent to US$534 million as people continue to use plastic money in response to the current crisis which has seen banks lower the limits on withdrawals. Most businesses have responded by installing POS machines while most fuel dealers now offer swiping facilities.
 
As at the end of June 2016, the number of POS devices in the market increased to 19,280 representing an increase of five percent from 18,330 in May. At the same time mobile payment agents stood at 34,351 as compared to 33,777 in May.  Debit, credit and prepaid cards increased to 2, million in June 2016, from 2,71 million recorded in May while bank accounts increased to 3,86 million.
 
The monthly report says that overall there was an increase of seven percent in the value of transactions processed through the National Payment System to US$6,9 billion from$6.48 in May 2016.

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