Thursday, June 30, 2022

Zimbabwe introduces RTGS dollar to solve currency problem

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Seli Baisie
Journalist/ Entertainment, Lifestyle blogger, Nature Lover.

“Nobody knows what it is,” is the verdict of Zimbabwe’s former trade minister and now opposition politician Nkosana Moyo.
He was talking about what appears to be a new currency in the country.
It has been introduced over the last few days but its impact is not yet clear.
Zimbabwe has a troubled history with currency.
In 2009 it ditched the Zimbabwe dollar and adopted the US dollar after hyperinflation destroyed its value. At its height prices were almost doubling every day and the reserve bank printed notes worth 100tn Zimbabwe dollars to try and keep up.
But because more US dollars were leaving the country – in the form of payments for exports – than coming in, US dollar cash was in short supply. This led to long bank queues as people struggled to get their money out.
In 2016, the government introduced bond notes and coins, which were supposed to be worth the same as the US dollar, to make up for the cash shortage.
But no-one had faith that they were equivalent and, on the black market, bond notes have lost value against the dollar.
And now the government has introduced the Real Time Gross Settlement (RTGS) dollar, which is being described by some as a new currency.
It’s not a phrase that exactly rolls of the tongue, but it is an acronym familiar to Zimbabweans who have been using it to describe money that has been electronically transferred into their bank accounts.
As well as paying for goods in US dollars, Zimbabweans have been able to use other foreign currencies such as the South African rand, plus bond notes, debit cards drawing on bank accounts and money stored on a mobile phone app.
But each of them had a different exchange rate, meaning that customers were sometimes charged different prices depending on what payment method they chose.

SourceBBC NEWS

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