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The Reserve Bank of Zimbabwe (RBZ) is reviewing legislation governing the mobile money transfer sector in order to decisively deal with abuse of the platforms, especially by illegal foreign currency traders, a Cabinet Minister has said.
Finance and Economic Development Minister Professor Mthuli Ncube said while mobile money platforms had assisted in facilitating payments in an economy short of hard cash, they had become a conduit for the illegal trade of foreign currency.
“The RBZ is therefore, currently reviewing all the regulations covering such platforms. In particular it is intended to place limits on daily bulk payer transactions and ensure compliance with the two percent intermediated money transfer tax on bulk payers,” he said.
“Additionally, the daily returns being submitted by mobile platforms to the Financial Intelligence Unit of the RBZ will be scrutinised very carefully by the currency stabilisation task force to ensure that all transactions are legitimate and are in accordance with the financial regulations in place.”
Adding on, RBZ governor Dr John Mangudya said the bank had already engaged one of the biggest players in the mobile money transfer business, Ecocash, regarding abuse of its mobile money platform.
“We have engaged Ecocash and Cassava on the need to ensure that we minimise the unscrupulous behaviour or business practices which we have noticed being done on this platform (Ecocash),” he said.
“We need to put a balance on that matter (because) whilst on one hand we are happy with the cash-light society on the other hand we are concerned with this unscrupulous behaviour being done by some people on the same platform so we have engaged Ecocash and Cassava. Ecocash shall be advising their clients about the changes that they will be doing on that platform.”
Meanwhile, Ncube said penalties for crimes relating to illegal foreign exchange and financial fraud were inadequate and needed to be reviewed.
“Government will be reviewing all the laws and institutional framework in order to bring them in line with international best practices and more importantly monitor the effectiveness of institutions charged with implementing the laws.
“The sanctions framework for illegal foreign exchange trading will be enhanced to provide for a range of effective, proportionate and dissuasive sanctions including more stringent criminal, civil and administrative penalties,” he said.
Illegal foreign currency trading currently attracts a minimum jail term of 10 years, but this has done little to dissuade traders from flooding the streets. – New Ziana
Bongani Ndlovu