GOVERNMENT has secured a loan facility from the Afreximbank to guarantee the 1:1 convertibility value of Real Time Gross Settlement (RTGS) balances into the United States dollar and availability of the greenback for Nostro foreign currency accounts, The Minister of Finance and Economic Development, Professor Mthuli Ncube, said yesterday.
The decision follows widespread fears over loss of value for RTGS or electronic balances at banks, on the back of spiralling parallel market exchange rates, which have spiked inflation, which is now hovering above four percent. The situation has been compounded by unjustified price increases which has seen some retailers increasing prices by more than 50 percent despite the fact that producers have not increased prices.
Minister Ncube, who is in Bali, Indonesia, attending the International Monetary Fund and World Bank meetings, allayed fears over loss of RTGS savings saying Government has put in place measures to retain value for electronic deposits.
“Government recognises concerns surrounding RTGS deposits and we commit to preserve the value of these balances on the current rate of exchange of 1 to 1, in order to protect people’s savings,” said Prof Ncube in a statement. He later posted on his Twitter account: “Today in Bali, Indonesia at the IMF/World Bank Meetings, I had fruitful discussions with the President of Afreximbank Dr Oramah. Afreximbank has offered Zimbabwe a facility to guarantee 1:1 convertibility of RTGS balances into US$ and availability of US$ for Nostro Foreign Currency Accounts (FCA).” he could not disclose the value of the back-up facility.
Over and above this Nostro deposit protection guarantee from Afreximbank, Prof Ncube said, Treasury was also reinforcing Nostro FCA accounts with a statutory instrument to guarantee that these are private deposits. This will ensure that “neither the Reserve Bank nor Government has any access to them,” he said.