Global payments technology company, Visa, will next month introduce a settlement service which allows Zimbabwean banks to settle domestic United States dollar-denominated transactions locally.
BY BUSINESS REPORTER
The move comes as local banks have put restrictions on local Visa transactions due to the biting liquidity crunch obtaining in the economy.
The National Net Settlement Service (NNSS) is a local settlement solution customised to process, clear, report and settle domestic transactions specific to the unique set of needs and requirements for a country.
Built on Visa’s transaction processing network, VisaNet, the NNSS combines the reliability and efficiency of the VisaNet system with the flexibility and visibility that will drive ongoing progress and enable continued success.
“Visa recognises that each country is unique, and that is why our National Net Settlement Service was designed as a local solution giving careful consideration to the distinct requirements and opportunities present in countries around the world and here in Zimbabwe,” said Andrew Torre, group general manager Visa sub-Saharan Africa.
“The service is an important step in our drive to deliver the security, convenience and efficiency of electronic payments to Zimbabwean consumers, and reflects our commitment to supporting Zimbabwe’s financial services sector and the country’s economic growth.”
Josephat Mutepfa, deputy director (financial markets) at the Reserve Bank of Zimbabwe said the bank welcomed Visa’s investment to ensure local transactions were settled on-shore while international payments will continue to be settled offshore.
“This will enable banks to continue to support the Reserve Bank of Zimbabwe and the country’s focus to move towards a cashlite, financially inclusive society,” he said.
Last year, banks suspended use of Visa and Mastercard for local transactions as they would have to settle using funds from an offshore account.
Banks have also put a limit on transactions done outside the country.
Zimbabwe has been battling with cash shortages since last year resulting in a number of depositors failing to get their money from banks.
The aggressive use of plastic money and the introduction of bond notes have combined to ease the cash shortages.
Visa is a global payments technology company that connects consumers, businesses, financial institutions and governments in more than 200 countries and territories to fast, secure and reliable electronic payments. It operates one of the world’s most advanced processing networks — VisaNet — that is capable of handling more than 65 000 transaction messages a second.