There is nothing surprising in Riverton Academy’s letter asking parents to fork out more in school fees next term. The reason was given for the rise also trite-it cites the Monetary Policy that did away with the 1:1 exchange regime.
All businesses have used this excuse to the point where it is now formulaic. What is igneous is in this letter is that Riverton has stumbled upon a not well-travelled path that will allow them to receive 100% of their foreign currency fees in cash.
Parents who do not want to be subjected to the usurious exchange rate used to convert the old USD fees into ZWL (RTGS) can continue to pay their children’s fees in foreign currency. The school meanwhile will be able to receive 100% of the payment in cash.
They are asking parents to pay via Money Transfer Agents
The statutory instrument that did away with the multicurrency regime still allows people to receive USD cash if money is sent via Money Transfer Agents (MTA).
There is a reason for this. The government is very much aware of the importance of these proceeds which are sent back by Zimbabweans in the diaspora back to their families and friends.
Forcibly converting that money to bond notes will no doubt have a chilling effect on these remittances. Companies meanwhile usually receive money straight into their bank accounts.
Currently, 50% of these proceeds are forcibly converted at the prevailing Interbank rate which is low and unfavourable. The remainder has to be used to make foreign payments in 30 days or that too is forcibly converted.
Riverton’s method allows them to keep cash
With bond notes, the fear is that they will eventually lose value as the economy continues its free-fall. With USD Riverton can keep its savings in a stable currency.