adminThe minister proposed a raft of measures to regulate the financial services sector saying financial institutions had failed to make necessary reforms.
In an interview, Zibawu general-secretary Mr Peter Mutasa said they would study the research findings before presenting them to other stakeholders.
“We have done the preliminary review of results on the research and we are now going to the next stage where we will be relooking at the empirical evidence of the research. There is no doubt that banks are not playing economic development as they are shortchanging the generality of consumers through high bank charges,” he said.
He said their research had also shown that the banking sector was under siege in terms of promoting economic development due to low deposits in the sector.
“If you look deposits are $3,8 billion against 23 banks or so. The banks are also grappling to meet the RBZ minimum capitalisation levels deadline. And in light of the indigenisation regulations, we are more certain that the banks may not get foreign direct investment to recapitalise,” he said.
RBZ has set June 2014 as the deadline for banking institutions to meet the stipulated minimum capitalisation threshold of up to $100 million for commercial banks.
“They are under pressure to meet the central bank minimum capitalisation levels and the only way for sustainability is to turn to their clients where bank charges become high.”
Mr Mutasa said it was critical to come up with a needs based approach in order to address the implications that would crop up due to the proposed regulatory measures.
“In our view, there is need for a dialogue because taking a one-side approach will not assist in any way as there will be bank failures resulting in job losses in the sector. Also in turn consumers will suffer if banks close. Let us have empirical evidence and take a needs based approach to the proposed regulations,” he said.
He said while Minister Biti’s concerns were genuine, the financial services sector survival also needed to be taken into account.
“As Zibawu, we are trying to proffer advice that there is a potential landmine that we need to de-mine as stakeholders.”
Minister Biti has proposed a framework for determining interest rates and bank charges which will see any bank deposit of at least $1 000 held over 30 days attracting an interest of 4 percent per annum.
He said because most ordinary workers were earning salaries below the Poverty Datum Line presently at $568, fiscal authorities were directing that no bank charges should be levied on any deposit of $800.
The Bankers’ Association of Zimbabwe has also said it was in consultation with the fiscal authorities over the proposed regulatory measures.
Bongani Ndlovu