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RBZ piles pressure on retailers, wholesalers as cash crisis deepens

13/04/2017 00:00:00
by Staff Reporter
 
RBZ governor John Mangudya
 
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THE Reserve Bank of Zimbabwe (RBZ) has released guidelines to compel retailers and wholesalers to bank their takings as the country’s cash crisis deepens.

Although the central bank has released about 104 million worth of bonds notes into the market since end of 2016, the move has failed to ease the cash shortages which started to worsen early last year.

The RBZ claims that retailers and wholesalers, a sector reserved for locals, have been contributing significantly to the crisis by avoiding the banking sector preferring to exchange the bond notes for the scarce United States dollar on the black market.

According the new guidelines, shops are expected to bank their takings within 24 hours and keep evidence of all bank transactions.

“Retailers and wholesalers shall be enjoined, in compliance with the Bank Use Promotion Act (Chapter 24:24), to bank the cash generated from their businesses and maintain records of all transactions (including purchases, sales, discounts and bankings).

“Any cash-back facility made available by retailers and wholesalers shall not exceed an amount of $20,” reads the rules circulated on Thursday.

The RBZ said it will work with the retail sector to increase the number of point of sale machines currently said to be at 33,000, according to finance minister Patrick Chinamasa’s last week report in parliament. Electronic payments are rapidly increasing as citizens have been forced to embrace the system in the absence of cash.

And following the prevalence of multiple pricing depending on the mode of payment, the RBZ has said it is criminal for retailers and wholesalers to do so.

“For the avoidance of doubt, retailers and wholesalers shall not charge any premium for the sale and purchase of their wares on the basis of mode of payment.

“Similarly, any cash or quantity discount, shall in accordance with best practice, be granted in the normal course of business and not on the basis of the multiple pricing system.”

The RBZ added, “In line with the need to promote transparency, banking and the use of plastic money, manufacturers and suppliers of goods, including fuel, should not demand cash for any goods supplied to retailers.

“In that regard, any dispensation and matching arrangements previously granted to certain sectors are hereby revoked.”



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Meanwhile, other factors fuelling the cash shortages, according to Chinamasa, included the high fiscal deficit worsened by an adverse current account situation and government’s employment costs, currently standing at over 93 percent of revenue.

Introduction of bond notes was precipitated by the disappearance on the market of the US dollar which was adopted to in 2009 to stop biting hyperinflation.

Monetary authorities also blame the US dollar shortages on externalisation. RBZ governor John Mangudya is on record saying the country lost $1, 8 billion in 2015 through illicit financial flows.


 
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