Banks urged to review interest charges

development believed to reflect restored confidence within the financial sector.
Dr Kanyekanye said that the rise in deposits should enable banks to reduce charges on interest rates. He said this could help industry to recapitalise.

“The increase in total banking sector deposits should reflect by offering loans to productive sectors.
“Capital injection to the manufacturing sector will result in increased capacity utilisation which will see growth in the economy,” he said.

Dr Kanyekanye said persistent liquidity challenges have affected industry, resulting in many companies failing to raise production levels. He also said the financial sector should come up with strategies to harness money believed to be circulating outside the banking systems.
“Financial institutions should focus on workable policies to tap more than US$3 billion which is reportedly circulating outside the formal banking channels.”

Bankers’ Association of Zimbabwe past president Mr John Mushayavanhu said the rise in deposits reflected restored confidence within the financial sector.
“People are now beginning to realise the importance of banking with financial institutions.
“However, many of these deposits are short term ranging between three and six months,” he said.

Mr Mushayavanhu said the sector would come up with plans that would restore more confidence within the sector. He said 70 percent of the deposits were of short term nature which made it difficult to increase lending. — New Ziana.