Vusumuzi Dube
Judith Phiri, Business Reporter
Bids for foreign currency on the auction system should now be submitted at least four business days before the date of auction, the Reserve Bank of Zimbabwe has said.
According to the Central Bank the move was done to give more time for due diligence.
In a statement on Tuesday, RBZ Governor Dr John Mangudya said this came after they had noted a significant increase in the number of bids being submitted through the auction system, averaging 2 000 per week.
“The Bank wishes to advise the public that, with immediate effect, all bids for foreign exchange shall be submitted through bidder’s respective bankers at least four business days before the date of the auction.
“The bankers shall in turn submit the bids to the Bank, the auction administrator, at least three days before the date of the auction. Any bid submitted later than the set time frame shall be disqualified,” read part of the statement.
Dr Mangudya said the change in bid submission timelines will give banks ample time to carry out the necessary due diligence processes and assess their customer’s bids.
The foreign exchange auction, introduced last year in June, is a system where the central bank regularly sells a given amount of foreign exchange through a bidding process and buys foreign exchange in the intervening periods at the previous auction-determined rate.
Government introduced the weekly foreign currency auction trading system to improve access to hard currency by businesses.
Since last year over 6 000 companies have benefitted from the platform’s formation.
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