Currency manipulators on RBZ radar

Source: Currency manipulators on RBZ radar | The Herald

Dr Mangudya

Africa Moyo

Deputy News Editor

Suspected black market currency dealing is constantly being monitored by the Reserve Bank of Zimbabwe (RBZ) and the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) to curb the menace and curtail speculative currency trading and rate manipulation.

The RBZ, through its Financial Intelligence Unit, is “closely watching every movement of money” through mobile money platforms and bank transfers, sources say.

The auction system has stabilised the exchange rate used in commercial transactions and while there is a modest premium in the black market that rate has also stabilised over the past few months, both because of reduced demand with the effective auction system and because of a raft of measures to reduce liquidity for speculative transactions.

The RBZ is keen to keep watch of illegal dealings to ensure the exchange rate and price stability achieved in the last few months following a raft of measures announced by monetary authorities to restrict the use of mobile money platforms, including capping transactions at $35 000 per week and restricting subscribers to using one mobile money account.

Potraz director-general Dr Gift Machengete told delegates during World Post Day commemorations last Friday at Gokwe Centre that his agency will continue to work with the RBZ to clamp down on illicit currency dealings.

“Inasmuch as the diversity of technology had brought financial inclusion and convenience, I would like warn all those unscrupulous elements who are conducting illicit activities using the various technologies available, to desist from such as we will leave no stone unturned in bringing the culprits to book.

“We applaud Government for the various steps taken to counter these nefarious activities, which were driving up the inflation rate in the economy and thus exposing consumers to various vulnerabilities.

“We will continue to work hand in glove with our colleague regulator, the RBZ, to ensure there is stability in our respective sectors.”

RBZ Governor Dr John Mangudya could not be reached for comment yesterday, but he recently told The Herald that further steps would be taken to ensure currency and price stability, as the RBZ seeks to have monthly inflation remaining low, at below five percent in the last quarter of the year.

The positive outlook is also supported by the increase in productivity in real sectors of the economy due to availability of foreign currency from a formal and dependable auction market.

Some currency manipulators, including mobile money agents, had become the centre of illegal money dealings which saw speculative behaviour driving up the black-market rates and as a knock-on effect driving up prices from March to June.

But on June 26, Government started imposing limits on transactions on all mobile-based money platforms: One Money, MyCash, EcoCash and Telecash.

The RBZ and Government first suspended mobile money agents and later made the suspension permanent. Merchant accounts were converted into one-way systems, so merchants could continue receiving money but ad to move this money to their bank accounts to spend it.

Individual transactions, the only spending now permitted on mobile platforms, was limited up to $5 000 a day for the convenience of the transacting public but now individuals are allowed to accumulate these daily limits for a week.

Bulk payments and mobile platforms, used by NSSA and the Government to pay pensions and those receiving social security allowances, are permitted at the discretion of the authorities but are not an automatic right.

All the unprecedented measures were necessitated by the need to protect consumers on mobile money platforms that were being abused by “unscrupulous and unpatriotic individuals and entities” to create instability and inefficiencies in the economy, said the RBZ.

Since then, prices have generally stabilised together with the exchange rate.