Guilty As Charged!

BANKS have admitted that banking charges currently prevailing are punitive on depositors and will immediately start conversations around lowering them while Steward Bank will with effect from today halve the charges on Real Time Gross Settlement transactions.

The average charge on an RTGS is U.S.$10 while withdrawal fees are on average at $3 inside brick-and-mortar banking halls and $2-$2,50 for withdrawals done on ATMs.Barclays Bank of Zimbabwe managing director George Guvamatanga said some of the charges being levied on depositors did not make sense and go against the financial inclusion drive that the central bank was currently advocating for.

This comes as the nation is currently going through a cash crisis which is mainly due to high demand on US$ following weaknesses in other currencies which are in the approve multi-currency basket and the non-replenishment of nostro accounts because of illicit financial flows.

The Reserve Bank of Zimbabwe Governor Dr John Mangudya has in the past accused banks of playing a part in driving away depositors through punitive bank charges for their service and products while they do not offer meaningful interest on savings.

Guilty As Charged!Add caption

Mr Guvamatanga admitted: "As a banker some of our charges do not make sense and they are actually ridiculous. I think the $10 charge for RTGS is just too much. We need to adopt a means of transacting, which is not punitive on customers."

He was speaking at the Archdiocese of Harare Social Communications business breakfast meeting yesterday.

Steward Bank chief executive Dr Lance Mambondiani also echoed the same sentiments saying while the use of plastic money was noble the extortionist charges by banks remain a challenge in the fight to restore confidence in the banking sector.

"Why does the RBZ charge $2,80 as residual fees on every RTGS? They have to take the lead in lowering their fees. Bank charges at the moment are extortionate and punitive for people to withdraw cash. We should start conversations around this."

Dr Mambondiani said bankers should not only talk but put their words into action.

"In fact, just to show that this is not just talk, Steward Bank will from Wednesday (today) halve the charges on all RTGS transactions."

Mr Guvamatanga also called on the RBZ to consider introducing a weekly withdrawal limit of $500, arguing that the current $1 000 per day was too high considering the average monthly deposit was at $374.

He said the $1 000 was prone to abuse from depositors.

"Given where we are and the pressure on banks, I will engage fellow members as Bankers Association of Zimbabwe, and the Reserve Bank of Zimbabwe (RBZ) in order to introduce a weekly withdrawal limit of $500 which will be adequate for day to day transacting.

"Internationally, you cannot withdraw more than $4 000 in the United States or £250 in the United Kingdom but here in Zimbabwe we are allowing corporates to withdraw $10 000 per day," he said.

Mr Guvamatanga said there was need to introduce a way of transacting that was not prone to abuse buy both depositors and bankers.