On June 17 the Minister of Finance announced that civil servants would start receiving an allowance of $75 USD. Retired civil servants will receive an allowance of $30 USD. This allowance is not going to be paid in cash, rather it will be paid in Nostro USD.
What is Nostro USD?
This is money in an FCA account. An FCA account is made so it can receive foreign currency.
What is a Nostro FCA Account?
This is just like a normal FCA account in other countries. The Nostro part simply means that money in that account originated from a foreign country. The Reserve Bank of Zimbabwe created Nostro accounts as a way of distinguishing between RTGS dollars which were once considered US dollar and real USD. Typical sources of funds in Nostro accounts can come from:
- Export receipts for example a company sells something abroad and gets paid in foreign currency. That money goes into a Nostro FCA account. For example a Nostro FCA USD account or a Nostro FCA Rand Account
- Money transferred from another Nostro FCA account. The RBZ administers a system which allows banks to distinguish between an RTGS and Nostro USD transfer. Nostro USD can only be transferred from one FCA account to another
- Foreign currency deposits. Due to restrictions that are imposed by the RBZ, very few people freely deposit cash into their Nostro FCA accounts
From time to time the RBZ announces rules that govern how Nostro FCA balances e.g. how they can be used and how long they can last (yes they come with an expiry date)
How can I open a Nostro FCA Account?
Well it depends on your bank of choice. Usually if you already have an account with a bank you can easily and quickly open an account. Sometimes all you need is to click a button!
|Bank||Account Type||Account opening fee/Initial Deposit||Visa/MasterCard Fee||Monthly service fee (US$)|
|BancABC||Individual FCA||N/A||No monthly service fee|
|CABS||Individual FCA||Initial deposit not required||$1|
|First Capital Bank||Individual FCA||New customers pay $5. If you already have an RTGS account you nothing||$2|
|FBC||Individual FCA||N/A||$3.50 Visa||$5|
|Nedbank||Individual FCA||$20 and $0 for existing RTGS customers||$5|
|NMB||Individual FCA||$15 Visa Card||$3|
|StanBic Bank||Individual FCA||$20||$5||$5|
|Standard Charted Bank||Individual FCA||None for existing customers||$15 Visa card||$5|
|Steward Bank||Dura Lite||$10 Visa card||No monthly service fee|
- N/A or blank means the information is not available. We have made and continue to make efforts to ascertain the information. However, some banks do not publicise this information. If you know the information or you think it is outdated you can contact us
What documents do I need to open a Nostro FCA account?
The RBZ requires that bank collect your personal information when you want to open your account. They call this KYC (Know Your Customer). This is meant to prevent and fight fraud and money laundering as well as foster accountability and transparency. Usually if you already have a bank account with a given bank, opening a Nostro FCA account requires less documents or even none.
Generally though banks require the following information from clients so as to be able to open an account:
- A valid national ID card or alternatively a valid passport or a driver’s license
- Proof of residential address such as electricity, water or telephone bills that is less than 3 months old. If you have none of this you might be required to somehow prove you reside at the given address. Some banks have affidavit forms for you to fill
- Proof of income source. This can be a payslip or financial statements. However, because most Zimbabweans are informally employed banks can just accept your word for it or ask for a recent bank statement from another bank usually covering the most recent 3 to 6 months
Some banks might ask for additional information above and beyond the above. Usually they ask for:
- Confirmation letter from your employer (if employed). Usually, this is when you are opening a salary-related account. Alternatively, see what we said above about income
- 2x Passport photographs;
Can I withdraw cash from my Nostro FCA account?
Well, this really depends on a lot of things. These include:
- The bank-some banks have better access to cash than others
- The source of funds-the RBZ has made it clear they do not want people withdrawing export proceeds easily. So if:
- your funds came from exports you will probably not be able to withdraw them
- Came from another local Nostro account, again you will have a hard time withdrawing them
- Came from a cash deposit-you will have a better time withdrawing them
- Are considered free funds e.g. a remittance from your relative or friend abroad you are more likely able to withdraw them
Is there a time limit when it comes to using funds in a Nostro Account?
Yes and no. Again depending on your source of funds. If from export proceeds or other Nostro accounts just make sure you use those funds within 30 days of receiving them. Otherwise they will be converted into RTGS at the prevailing rate and sold to businesses by your bank.