THE Reserve Bank of Zimbabwe (RBZ) has issued a new $50 banknote whose circulation begins today and is expected to ease cash shortages and enhance convenience by the transacting public.
The new red-brownish note has impressions of the “tomb of the unknown soldier”, the traditional balancing rocks and the motif of first Chimurenga/Umvukela heroine, Mbuya Nehanda, among other key features. Its circulation will complement the $20, $10, $5 and $2 notes that are already in use.
Business leaders have welcomed the introduction of the new banknote citing the need for consumer convenience when transacting in cash as well as taming charges associated with multiple withdrawals of small denominations, especially at Automated Teller Machines.
They, however, stressed the need for monetary authorities to consolidate value preservation of the local currency so as to keep inflationary pressures under check.
Government has said the introduction of high-value denominations into the economy will not exacerbate higher levels of inflation as long as the Reserve Bank of Zimbabwe (RBZ) does not print too much money.
In a statement announcing the new bank note, RBZ Governor Dr John Mangudya said $360 million will be injected into the market.
“The Reserve Bank of Zimbabwe wishes to advise the public that the ZW$50 banknote issued on 6 July 2021 through Statutory Instrument 196 of 2021, will be introduced into circulation on 7 July 2021,” he said.
“The bank shall release ZW$360 million through the normal banking channels and banks are expected to fund their respective accounts held at the Reserve bank and collect the cash from 7 July 2021.”
Finance and Economic Development Minister, Professor Mthuli Ncube has already gazetted Statutory Instrument 196 of 2021 to support the issuance of the new banknote. The latest Government Gazette, dated 5 July 2021, also explains the key features of the new note, in line with the Reserve Bank of Zimbabwe Act.
Economist and chief executive officer for the Association of Business in Zimbabwe (ABUZ), Mr Victor Nyoni said the situation where traders had to carry huge chunks of cash for small transactions was no longer viable.
“It makes sense to introduce a bigger note. But it must be said that as business we are worried that smaller notes such $2 and $5 have completely disappeared on the basis of being valueless,” he said.
“Value restoration on our currency remains the biggest challenge. Therefore, $50 notes must not necessarily be seen as a way of pushing out the smaller notes.
“Other countries that have higher notes like Botswana and South Africa still very much use their smaller notes too. We expect the same situation to prevail in Zimbabwe.
“At the end, currencies must bring convenience in the exchange of goods and services. There is urgent need for our policies to address the need to keep all notes from the smallest to the highest relevant in our daily trading system.”
Financial market analyst, Mr George Nhepera allayed inflationary fears saying the new note brings more convenience to the general public including the business community.
“From an economic and monetary point of view, it shall not be inflationary as it is merely a change of bank money within a bank balance sheet into cash,” he said.
Political Actors Dialogue (Poland) economic committee chairman, Mr Trust Chikohora said as long as money supply remains the same, then the introduction of the $50 note will just be convenient for the transacting public.
“It is easier to withdraw cash especially those that don’t have plastic money and other mobile money payment platforms, especially in the rural and other remote areas who need to use cash,” he said.
“It’s convenient for them when they get into town to access their cash and to be able to transact more easily. If it’s just the notes with the same balances and the same money supply in circulation, then it won’t be inflationary as such.”
Already, the Zimbabwe National Statistics Agency (Zimstat) says the country’s annual inflation is on a downward trend, dropping by about 55,3 percent to 106,64 percent last month from 162 percent. The RBZ, has projected that it will decline to 55 percent this month.
The month-on-month inflation in June 2021 was 3,88 percent up by 1,34 percentage points on the May rate of 2,54 percent.
Economic commentator Mr Reginald Shoko also commended the Apex Bank saying the higher denomination note will assist transacting public, especially those who are using ATMs.
“This will go a long way in reducing the bank charges associated with the withdrawal of the weekly limit. Many people had to do multiple withdrawals because of the maximum $20 note,” he said.
In the Government Gazette, Minister Ncube said: “There shall be issued, in terms of the Act, a fifty-dollar banknote. The design of the fifty-dollar banknote shall be as follows –
“(a) on the front side the dominant feature shall be the logo of the Reserve Bank of Zimbabwe (three balancing rocks), with the visually impaired recognition feature to the left, latent image showing the denomination, windowed security strip inscribed “50” with colour shift from red to green, watermark with highlighted inscription “RBZ” and see-through of Zimbabwe Bird looking to the left in perfect register, as secondary features; and
“(b) on the back side there shall be an impression of the Tomb of the Unknown Soldier and the motif of Mbuya Nehanda, gold coloured iridescent band showing the denomination of the note and see-through of Zimbabwe Bird looking to the right.”
The new $50 banknote whose composition is cotton paper will be measuring 156mm by 66mm, brown in colour, and bears a Zimbabwe bird watermark.
- Banknotes have a unique rough feel which is different from other printed materials such as magazines or computer printouts.
- Watermark: When held against the light the Zimbabwe bird and ‘RBZ’ can be seen. In reverse, this will appear backwards.
- Windowed Security Strip: The strip changes from red to green with a holographic element when tilted. When held up to the light it reads as a continuous line reading ‘50’ on the front and ‘RBZ 50’ on the back.
- See-through: Locate the shape above the watermark. Hold the note up to the light. The shape completes with the image on the back of the note to form the Zimbabwe bird in a star.
- Iridescent Band: when the note is tilted. Moving the note around shows a shiny stripe pattern on the back of the note. The stripe shows the denomination of the banknote.
- Feature for the partially sighted: Six horizontal bars appear in the bottom right and left-hand corners. These have a raised effect to help the partially sighted recognise this banknote.
- The value numeral can be seen in the feature on the bottom left when the note is tilted.
state media, zwnews