Saturday 12 August 2023


THE Financial Intelligence Unit (FIU) has said it is going to investigate and take punitive measures against schools that are inflating figures of school fees in local currency by using parallel market exchange rates.

FIU said inflating figures of school fees in local currency by using parallel market exchange rates is an affront to the gains made so far in stabilising the national economy. The warning comes in the wake of a number of schools around the country having started issuing out fees structures for the third term to parents and guardians.

It has emerged that most private schools have fees structures in USD and RTGS. However, the RTGS figures are speculative and beyond the prevailing bank rate and even black market rates. The Reserve Bank of Zimbabwe (RBZ)’s Financial Intelligence Unit (FIU) director-general, Mr Oliver Chiperesa, said such practices by schools, both private and public, were illegal.

“Forward pricing and using parallel market rates is illegal. All institutions are required to use the official exchange rate obtaining at any given time. The FIU will be engaging the schools doing that whenever we get complaints of such nature on our hotlines which we regularly publicise.

We urge the public to continue giving us such reports and we will definitely investigate the malpractice and ensure the necessary corrective steps are taken through the relevant authorities,” he said.

In circulars seen by Sunday News, a number of private schools in Bulawayo have inflated fees for the third term using an unofficial rate of US$1: ZWL$10 000 against the official exchange rate which stood at US1: ZWL$4 559 last week.

At some institutions where the illegal black market model is used, the fees in local currency are pegged at ZWL$14 million, ZWL$15 440 000 and ZWL$19 800 000, and are subject to an upward review as the clock ticks towards the opening of schools.

“If you get a school fees invoice of US$2 400 as is the case at a school where my son goes to, expect the RTGS figure to be around ZWL$24 million because these private schools seem to operate outside RBZ laws, and that has been going on for a long time.

As we move closer to the opening of schools, you will hear of more astronomical figures from other established private schools countrywide,” said a parent with a child at a private school in Bulawayo.

According to the Ministry of Primary and Secondary Education school calendar for 2023, the third term is set to resume on 4 September and end on 1 December.

The Consumer Council of Zimbabwe (CCZ) Matabeleland Region manager, Mr Comfort Muchekeza, said although it was commendable that the schools communicated the fees structure while there was still time, the unofficial rate they were using was “unacceptable and out of this world”.

“Starting with the positive, what the schools have done in terms of notice period should be commendable, advising parents beginning of August for the third term fees gives parents and guardians enough time to adjust their budgets and gear themselves for the increment.

What worries us as CCZ and I believe even the Government and the monetary authorities is the use of black-market rates of US$1: ZWL$10 000. This is almost double the official rate be it the inter-bank or auction rate plus the 10 percent margin.

The schools should just notify parents to say if paying using any other currency which is not the US dollar, official rates should apply, yes the amount to be paid in other currencies will be different depending on the rates by the time payment is made.”

He said private schools were engaging in speculative behaviour by already predicting that the rates by the third term would be US$1: ZWL$10 000, which was contrary to what was happening on the ground. Mr Muchekeza said the past few months have witnessed a significant gain in value of the Zimbabwean dollar against the US dollar, something that has stabilised rates even on the black market.

Meanwhile, the FIU has indefinitely frozen bank accounts of a number of major suppliers of goods and services for allegedly refusing to transact in local currency and engaging in forward pricing, malpractice believed to be fuelling exchange rate volatility.

Furthermore, the Government suspended licences for 17 pharmacies in different parts of the country that were using parallel market exchange rates, violating Government policy and the country’s anti-money laundering regulations.

Industry experts say the Government has made considerable progress in stabilising the economy, the exchange rate and general prices of goods and services by implementing a variety of fiscal and monetary stabilisation measures.

As an indication of the market’s positive response to a series of policy interventions put in place by the Government and the monetary authorities,  prices for basic goods and services have stabilised as the local currency has continued to firm. Sunday News


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