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Electronic Money: Zim Govt Moves to End Cash Shortages

Government has come up with a cocktail of measures to address cash shortages through an expansion of electronic money transaction systems a...

Government has come up with a cocktail of measures to address cash shortages through an expansion of electronic money transaction systems and promotion of domestic savings.

In an interview, Finance and Economic Development Minister Patrick Chinamasa said Government would continue to devise systems to ensure the cash shortage problem was addressed.

“Long queues outside the banks are being experienced particularly during month-ends and Government is promoting the use of electronic payments in order to reduce pressure on the demand for physical cash.
Cash shortages in Zimbabwe

“As at end of year, 325 40 point-of-sale machines and 40 590 agents were deployed across the country in all sectors of the economy. This momentum to grow devices and access points dovetails with the national financial inclusion policy thrust where the planned deployment is expected to reach 100 000 POS’ and 90 000 mobile payment agents by year 2020. 

“It is encouraging to note that, in keeping with the thrust of promoting electronic payments, a number of payment service providers and banks have enhanced deployment of devices and access points.

“Further, the Reserve Bank reduced the charges for using electronic payment platforms to one percent on the automated teller machines and 1,25 percent withdrawals on the counter,” said Minister Chinamasa.

Minister Chinamasa domestic savings were critical to dealing with cash shortages as remittances from Zimbabweans outside the country, inward foreign investments and external loans would be used for revenue generating development projects.

The finance chief said Government had stepped up efforts to broaden its tax base to increase the amount of foreign currency collected at Zimbabwe’s ports of entry and exit.

“Government has instituted measures to enhance tax collection efficiency, curb revenue leakages and corruption through automating the Zimra tax management system, capacitating Zimra with relevant skills to detect transfer pricing and other techniques to deal with illicit financial flows and introducing an electronic cargo tracking system to monitor transit traffic.

“The implementation of these measures has already started yielding positive results and ZIMRA met its revenue target for the first two months this year,” he said. The opening of tobacco auction floors this Wednesday is also expected to improve foreign currency cash flows.

Monetary authorities forecast an output of between 200 and 215 million kilogrammes of tobacco this season and, according to the Tobacco Industry and Marketing Board, over US$700 million had been mobilised for purchases.

The Reserve Bank of Zimbabwe, which is importing US$15 million in cash weekly, is focusing on brining in denominations of US$2 and US$5 as bigger face value notes are prone to externalisation, hoarding and black market trading. - The Sunday Mail

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