‘Zim must up its game in money laundering’

Zimbabwe risks becoming an economic outcast if it does not take anti-money laundering (AML) measures seriously, a senior banker has said. In February this year local banks had their nostro accounts closed by South African and German banks, which is said to have exacerbated the current cash crisis. Speaking at the FBC Holdings Limited 12th annual general meeting on Thursday, chief executive officer John Mushayavanhu said money laundering affected relations with the international business community.

“If the country does not up its game in terms of AML issues, we risk what is called financial abandonment, in other words we will not be able to make cross border transactions,” he said.

Mr Mushayavanhu said FBC had since organised a $10 million facility through which it could guarantee funds for any of its exporting customers. “We are finalising a facility of $10 million with the regional financial institution and if all goes well, and I do not see that it will not go well, we should be able to draw down on this facility by the end of August this year.

“We intend to use this money to only lend to our exporting customers so that they can generate more exports and in that way our nostro accounts at FBC Bank will have funding,” he said.

In a trading update for the year starting January this year, Mr Mushayavanhu said all businesses were profitable and he anticipated that the company would exceed last year’s operating performance.

He noted that the recent Reserve Bank of Zmbabwe directive, which reduced all transaction fees, had resulted in a “significant reduction in the demand for cash” leading the company to focus more on e-commerce.

“We have increased the number of point-of-sale machines in the market and it is important to encourage our customers to use mobile banking, internet banking and our mobile app,” he said.

Last year the group posted a profit before tax of $21.3 million compared to $17.1 million in the previous year. Mr Mushayavanhu attributed the company’s success on “cost containment” measures adding that they were still assessing the effect of transaction charges on overall business. — New Ziana.