THE Reserve Bank of Zimbabwe (RBZ) will set up a desk to handle complaints about high bank charges as the central bank steps up efforts to restore order in the sector.
REPORT BY NDAMU SANDU
RBZ governor Gideon Gono last week warned of dire consequences on any bank found on the wrong side of good practices.
“We will establish within the bank a desk that looks at malpractices and brings them to our attention, effective January 1, until such a time we will hand over the complaints to the ombudsman,” Gono said. “We will not let them [banks] get away with it.”
The RBZ boss said he was in agreement with Finance minister Tendai Biti on the need to bring order in the sector as banks were ripping off clients.
“What concerns the minister of Finance is the same that gives the governor sleepless nights,” he said.
In his 2013 Budget, Biti proposed a raft of reforms to stem what he termed “voodoo” banking practices. He said the reforms were necessitated by the fact that Treasury’s calls for the banking sector to organise themselves were not heeded.
Biti decreed that no bank charges should be levied on deposits up to a maximum of US$800. He said any term deposit of US$1 000 and above held over a period of at least 30 days and above should attract an interest of at least 4% per annum.
Biti said government would be coming up with a Statutory Instrument informed by a Memorandum of Understanding between financial institutions and the central Bank stipulating thresholds of applicable fees, charges and interest rates.
The effective date of the Statutory Instrument would be January 1 2013.
Gono said he was in talks with players to ensure that the sector was compliant with Treasury’s directive.
“The minister was gracious to throw the ball back to the governor. We are at a stage where before deadline, we would have reached an agreement,” Gono said.
Banking industry equated to goblins
Banks have been accused of not paying interest on deposits but charging interest of up to 40% per annum on loans.
Banks argue that interest rates on loan are determined by a number of factors such as the cost of getting the money from foreign institutions.
Banks say they get lines of credit offshore and the cost of that money took into consideration the perceived country risk.
A number of micro-finance institutions are charging interest rates of 40% per month, drawing the ire of RBZ which has equated the industry to goblins.