RBZ to tighten noose on OneMoney

By Staff reporter | 09 Jun 2020 at 18:23hrs
Reserve Bank of Zimbabwe governor John Mangudya's ambush raids on illegal forex trade faces a stern test as the government-owned mobile payment platform, OneMoney, operates untamed.

The development comes after RBZ reduced monthly limits on banks and EcoCash as part of strategies to stem rent-seeking behaviour and speculative tendencies which continue to destabilise and devalue the local currency.

Prior to the March 30 lockdown, the domestic unit official rate remained fixed at 25 to 1 against the US dollar while the parallel market rate is trading as high as 1:73.

Mangudya has put some strings on the banks to transact a maximum of ZWL$100 000 per month and suspended a number of EcoCash agents' lines for moving loads of money.

However, economists say this will face a stern test.

Last time when Mangudya tried to tighten screws on gold smugglers, Zanu-PF youths called for his dismissal.

Mangudya told Business Times the central bank is plugging all possible holes that are causing the exchange rate to soar.

"We have come up with the number of initiatives to stop the persistent battering of the domestic currency by rent-seeking behaviour on the parallel market and some of the strategies include dealing with transactional limits and closely monitor agent lines," Mangudya said.

"We have dealt with those who abuse agent lines and banks; we shall deal with other platforms that continue to operate openly. Just give us time we will leave no stone unturned."

Soon after the RBZ-EcoCash fight, the mobile payment platform has been on the downward side as it continues to trade below 1:55 against banks' rate of 1:75.

Despite enjoying high rates, banks will not push high volumes due to ZWL$100 000 monthly limit, leaving OneMoney as the transactional platform of choice.

Economic analysts said most of the EcoCash dealers whose lines were closed have crossed to OneMoney.

On the OneMoney platform, US$ is trading at 1:67.

Harare based economist who preferred anonymity said: "Mangudya and his Monetary Policy Committee can come up with good strategies like reining in on OneMoney but given that it's a government controlled thing, their chances of dealing with the platform are next to zero because their hands are tied and are serving at the mercy of H.E (Mnangagwa).

"I bet my last cent that he may come up with a press statement but will not implement it."

Mangudya said Zimbabwe was getting significant inflows of foreign exchange from gold, tobacco and other sources to support its import need but the Covid-19 pandemic has kept the exchange rate and the currency under pressure.

Economists said the depreciating of the local currency since its introduction, last year was due to underlying problems that include confidence crisis, speculation, policy shortcomings and the domestic economy's current structural challenges.

RBZ's Financial Intelligence Unit last week suspended all mobile money agents and directed the network operators to implement proper know-your-customer evaluations to make sure only genuine businesses use the platforms.



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