When the RBZ governor, Dr. Mushayavanhu, introduced the ZiG currency at the start of last month, he promised that ZiG notes and coins would be released to the public on April 30, 2024. As promised by Reserve Bank of Zimbabwe (RBZ) Governor Dr. Mushayavanhu, ZiG banknotes and coins became available yesterday at banks and financial institutions across the country. However, there’s initial confusion surrounding the largest denomination currently in circulation. It seems, based on what we have seen and heard,at the moment the biggest note is the 10 ZiG note.
While official confirmation is pending, the biggest note currently available appears to be the 10 ZiG note. This has led to speculation about the absence of higher denominations. The Zimbabwean government, known for its communication gaps, hasn’t clarified whether this is the highest note or if larger denominations will follow. Previously, the government announced a “drip-feeding” approach to releasing ZiG notes. This could explain the limited availability of larger denominations. Perhaps they’re cautiously introducing the 10 ZiG note before releasing higher values like the 200 ZiG.
At this moment ZiG cash is just change
With the 10 ZiG note being the apparent largest denomination, ZiG cash currently functions primarily as change. At the time of writing, 10 ZiG is equivalent to approximately US$0.74, R13.90 South African Rand, or £0.59 British Pound. This means buying basic items like bread (currently US$1 or 14.10 ZiG in supermarkets) requires two 10 ZiG notes. Larger purchases would necessitate significant amounts of cash. For any serious shopping, you would need wads or even possibly a bagful of these notes.
This situation is reminiscent of the Zimbabwean Dollar (ZWLD) bond note era, where the denomination’s low value restricted its use to petty transactions. It looks like ZiG is set to continue with that role. What is a bit confusing, however, is that the government set generous withdrawal limits. Individuals have a weekly withdrawal limit of 3000 ZiG or about US$222 at current rates. That would be three hundred 10 ZiG notes. Will the government be able to supply the large amount of 10 ZiG notes needed to fulfil demand? The withdrawal limit suggests an intention for wider circulation, while the limited availability of larger notes contradicts this. The government’s decision to issue potentially expensive-to-produce low-value notes during the ZWL era is a cause for concern. This policy incoherence raises questions about the sustainability of the current approach.
Despite the confusion, the informal sector, which has faced significant challenges in recent months, welcomes the availability of ZiG cash, even in smaller denominations. This provides much-needed change to facilitate transactions. Clarity from the government regarding the availability of larger denominations and the rationale behind the limited initial rollout is crucial. As the situation unfolds, Zimpricecheck will continue to provide updates.
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