In our latest survey, we were curious to see how people are coping with the effects of NPS Directive 01/2019 which banned cashout and cashin transactions. To our shock most “agents” were charging a steep 100% if someone wanted to “cashout” notes and about 80% if someone wanted coins.
Cash sellers at 4th street bus terminus who normally charge around 35% when people want coins were using their personal lines, merchant lines, ZIPIT and swipe machines to accept electronic currency in exchange for cash at these new steep rates.
While the majority of the people said they were in support of the RBZ for banning Ecocash they bemoaned the fact that they were now bearing the brunt of the ban.One individual who runs a small business posted this message in one of the WhatsApp groups we frequent:
For small businesses like mine which require hard cash, we rely on those Rogue Ecocash Agents. Banning Cash out has worsened the situation, where I had to pay an extra 35% commission to get my cash via cash out, the agents are now requiring 100 % i.e if i send him $100 into his Ecocash wallet or Zipit account he gives me $50 in hard cash…
The same charges were in effect throughout town and even at these rates people were lining up as most businesses have taken the drastic measures of not accepting Ecocash either because they are afraid of being caught in the dragnet or because they simply cannot, for example, two of the tuckshops we use have accepted payments via cashout. Now they cannot.
Ruwa and Marondera Kombis were also charging double if people wanted to pay via Ecocash. Again helpless commuters had no choice as most cannot go to banks to make withdrawals as suggested by the RBZ in its ban since going to the bank means missing work that is if the bank in question has the cash to give out anyway.
It proves what we have been saying all along
This proves what we have been saying all along. The ban on cash-in, cashout and cashback are all misguided and based on faulty logic. The Reserve Bank of Zimbabwe needs to print adequate cash because for all the talk of digital payments there is still an appetite for cash in Zimbabwe.
Part of the reason for this is the 2% tax. It has had the effect of punishing people for preferring electronic payments. Factor in the charges by banks and mobile money operators every time you want to move cash around and it’s very easy to see why we have a serious problem.
This morning, for example, we had to pay a bill of $443 ZWL to a local company. Making the payment cost us around $457.50. That means the entire transaction cost us an extra $14.50 compared to what we would have paid using cash.
If you pay a lot of bills and considering the prices we now have to pay for even the most basic commodities these charges start to add up. It is easy to see why people prefer cash. It is the RBZ which is supposed to print cash.
Why the highest denomination of $5 does not even buy you a loaf of bread. In what other country except our is this the case?