• Loading stock data...

Latest News


THE banking sector will start paying interest on savings and fixed deposit accounts starting next month in compliance with Statutory Instrument 65A of 2020, the Reserve Bank of Zimbabwe (RBZ) has said.

The move buttresses Finance and Economic Development Minister Professor Mthuli Ncube’s pronouncement last year of Statutory Instrument 65 of 2020, which directed banks to pay interest on savings accounts and fixed deposits.

The directive was issued to promote financial intermediation and to stimulate production. However, banks were yet to observe the directive.

In a statement yesterday, RBZ Governor Dr John Mangudya said following successful engagement with the Bankers Association of Zimbabwe (BAZ), banks have complied with the new directive.

“The bank wishes to advise the banking public that it has engaged the Bankers Association of Zimbabwe on the need to comply with Statutory Instrument 65A of 2020 on the payment of interest on savings accounts,”

he said.

“To this end, interest rates on deposits that shall be offered by banking institutions, effective 1 July 2021 are as follows: savings accounts minimum of five percent per annum on Zim$, a minimum of one percent per annum on US$.”

The Governor said fixed term deposits for $ will be paid at a minimum of 10 percent per annum and a minimum of 2,5 percent per annum for US$.  There will be no bank charges on savings accounts and fixed term deposits.

The Apex Bank has also advised the public that demand and call accounts were transactional accounts from which funds deposited can be withdrawn at any time and without advance notice, hence in line with global practice, banking institutions will not be able to pay interest on such transitory deposits.

Prof Ncube is on record saying banks were charging high transactional charges and lending rates, which means they could afford to pay interest to depositors. Banks are supposed to pay an interest rate of not less than 90 percent on Treasury Bills and at least 75 percent for individual and corporates’ savings for a period of 30 days.

In the SI, the RBZ was also granted powers to determine the yields of Treasury Bills and interest on individuals’ as well as corporate balances.

In the 2021 Monetary Policy Statement (MPS), Dr John Mangudya said the banking sector’s performance last year was satisfactory after it recorded a $34,2 billion profit for the year ended December 31, 2020.

Banks also improved in the key risk and performance indicators. As at December 31, 2020, total banking sector core capital of $40,85 billion, reflected an increase of 94,08 percent, from $20,99 billion as at June 30, 2020, mainly attributable to growth in retained earnings, bolstered by revaluation gains from foreign exchange denominated assets and investment properties.

Capital positions remain strong in the banking sector, with average capital adequacy and tier 1 ratios of 34,6 percent and 22,7 percent as at December 31, 2020, which were above the regulatory minimum of 12 percent and 8 percent, respectively.

Leave a Reply

Your email address will not be published. Required fields are marked *