Financial institutions and mobile money platforms began
converting customers’ Zimbabwe dollar balances into ZiG late Friday following
presentation of the Monetary Policy Statement (MPS) by RBZ Governor Dr John
Mushayavanhu.
Banks notified clients that their local currency accounts
were being converted into ZiG and that Zimbabwe dollar transactions were
suspended until further notice.
As a result, all point-of-sale and mobile money platforms
were unavailable yesterday, while retail shops accepted only US dollars and
Zimbabwe dollar notes. According to the Bankers Association of Zimbabwe, the
process of reconfiguring all Zimbabwe dollar accounts is set to be complete by
tomorrow at most banks.
The Sunday Mail has gathered that commercial banks are
expected to begin dispensing the new ZiG notes and coins early this week.
The central bank will begin drip-feeding smaller
denomination notes and coins to commercial banks early this week for
disbursement once the conversion process is complete.
Electronic transactions for some banks are expected to
resume by tomorrow, as Zimswitch, the country’s electronic financial
transactions settlement platform, finalises adjusting its systems to
accommodate the new currency.
In an interview with our Harare Bureau yesterday, Dr
Mushayavanhu said ZiG will commence circulating in the market this week.
“They (ZiG notes and coins) are going to be disbursed early
this week; it might not be on Monday,” he said.
“It might be a few days after, but they are going to be
disbursed this week. That is what we are expecting. As for the amounts, we are
going to print enough.”
The RBZ was yet to set cash withdrawal limits because “we
want to see the reaction of the public before we set the limit”.
The gold-backed ZiG will be issued in denominations ranging
from 1 ZiG up to 200 ZiG, as well as half ZiG and quarter ZiG.
Presenting the MPS, Dr Mushayavanhu said the new currency
will be introduced into the market gradually.
“These notes shall be issued gradually in the market to
cater for small transactions and to ensure the availability of change, thus,
mitigating the use of retail vouchers in the local economy. As such, the
proposed denominations will bring convenience to the transacting public,” he
said.
In Harare, retailers were transacting exclusively in US
dollars and Zimbabwe dollar notes. Many people, who were caught off-guard by
the currency changeover, were left frustrated, as they failed to transact in
the local currency.
“We were not anticipating this changeover,” said Budiriro
resident Mr Brenna Mandivava.
“Everyone who does not have US dollars is having trouble
transacting. We hope they sort this out soon.”
Retailers were also busy converting prices of their goods
into ZiG.
Confederation of Zimbabwe Retailers president Mr Denford
Mutashu said: “We are complying with Government’s directive and we are in the
process of converting the prices to the new currency.
“Retailers are only transacting in US dollars to ensure
that consumers are not inconvenienced by the migration process. We are
confident that by Monday most retailers would have migrated to ZiG.”
Bankers Association of Zimbabwe president Mr Lawrence
Nyazema said banks were reconfiguring all Zimbabwe dollar accounts.
He said the process is set to be complete by tomorrow at
most banks.
“We expect to start disbursements of new notes this coming
week (this week),” said Mr Nyazema.
“Remember, the old Zimbabwe dollar notes will be coming
back as deposits as they are taken out of circulation. Banks have been working
flat out since midnight (Friday) to reconfigure Zimbabwe dollar accounts and
balances to ZiG. Some will maintain the same account numbers, while others will
have to open new accounts in the new currency. We expect ZiG accounts to start
coming on stream at different banks this weekend and we are all targeting to be
up and running by Monday morning. Zimswitch will be switched on for banks as
and when they convert to ZiG accounts.”
Zimswitch marketing manager Ms Sharon Marira said the
platform will be back online once banks have completed reconfiguring the
balances.
“It will largely depend on the banks’ readiness and
configuration,” she said.
“We have already sent notices to customers, informing them
that the system is down. When the system has been restored, banks will inform
the customers. This, however, will not be uniform as it will depend on banks.”
Economist and member of the RBZ Monetary Policy Committee
Mr Persistence Gwanyanya said the new currency will be widely available before
the end of the week.
“We expect the notes to be in circulation as soon as
Monday,” he said.
“I believe the new currency will perform better compared to
its predecessor because it is backed by physical (gold and cash) reserves.”
The introduction of ZiG is part of several policy measures
meant to address exchange rate volatility, curtail inflation and restore
macro-economic stability.
The new currency replaces the Zimbabwe dollar, whose value
has been depreciating rapidly over the past few months.
The new currency will be backed by the quantity and value
of precious minerals — mainly gold — as well as foreign currency reserves held
by the RBZ.
As of Friday last week, the central bank had in its
reserves US$100 million in foreign currency and 2,5 tonnes of gold valued at
US$185 million. Sunday Mail
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