Tuesday, March 1, 2011

Banks to return SA coins

Monday, 28 February 2011 20:18

Herald Reporters

LOCAL banks are set to return R8 million worth of coins to South Africa that they have been holding onto since last year because retailers have resisted buying them to ease change shortages that consumers have long complained about.

President of the Bankers Association of Zimbabwe Mr John Mushayavanhu yesterday said they had been sitting on the coins for nearly eight months now.

A shortage of rand and US coins in circulation means people often spend more than they intend to in shops so that their bills can become round figures.

Shops also give out credit notes indicating how much change customers are owed, but these are only redeemable in the specific branches where they are given.

The Consumer Council of Zimbabwe has said this has contributed to the high cost of living in Zimbabwe as people spend more than they want to.

Banks had sought to ease the problem by buying coins in South Africa, which they offered retailers at prevailing rand-US dollar exchange rates, but the latter appear not to be interested.

Said Mr Mushayavanhu: "We have already received app-roval from the South African Central Bank and we will be returning the coins anytime now."

Mr Denford Mberi of the Retailers Association of Zimbabwe is on record as saying the banks were trying to profit from the coins by selling them higher than the exchange rate.

Many Harare retailers have maintained an artificial rand-US coins exchange rate of 10:1.

This means R5 is equivalent to 50 US cents.

The actual rate would have R5 at around 71 USc as the South African currency has long since gained on the greenback.

Oddly, Harare's informal traders apply more realistic rates and even commuter omnibus operators have tried to give people value for their money in coin terms by charging a normal trip at R4 or 50 USc.

Street vendors also have coins and these are easily changing hands, a development that has stoked people's fury as to why formal establishments cannot give them a fair deal as well.

Harare retailers have failed to explain why they can apply the prevailing rate quite easily on notes, but not on smaller denominations and for change purposes.

AfroFood Julius Nyerere Way branch said they only applied prevailing rates to amounts of R50 or more, but would not explain why this was so.

TM Mbuya Nehanda Street, OK Robson Manyika and Spar Joina City also had no reason as to why they undervalued South African coins.

Some of these retailers have branches in Bulawayo where similar problems are not being experienced.

Mr Mberi referred all questions to a Mr Ndebele at Truworths' headquarters in Harare, who was not available for comment.

Finance Minister Tendai Biti has for months said Zimbabwe will soon get US coins, but these have not been seen.

People have also questioned why the finance minister is prepared to bring in coins from across the Atlantic Ocean when the South African option is readily available much closer home.

The public has called for legislation to be put in place to force retailers to be fair.

"The Government must make it illegal for this daylight profiteering which these shops are practising.

"They are forcing us to buy useless things like sweets and if you add up all the money that people are forced to use, you will find that they have extra sales of over US$100 in each shop a day," railed Mr Cosmas Dumba of Warren Park who had been forced to take lollipops as change after buying a cough mixture in OK First Street.

The situation is much better in Bulawayo where the actual exchange rate is applied.

For instance, kombis in Bulawayo generally charge R3 per trip and coins are readily available as change in just almost every shop.

1 comment:

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