Bond notes still legal tender, says RBZ

THE Reserve Bank of Zimbabwe (RBZ) has dismissed as a hoax messages circulating on social media calling on Zimbabweans to deposit all bond notes claiming the Central Bank wants to replace them with a new currency in November.

Deputy RBZ Governor, Dr Kupukile Mlambo, said yesterday that the Central Bank will soon release $300 million more bond notes after the initial $200 million facility was exhausted, contrary to the misleading social media reports.

The alleged hoax message reads in part: "RBZ urges every Zimbabwean citizen to deposit their money before the 1st of November 2017. The Zimbabwean central bank has come up with new notes to be used other than bond notes, which has devaluated. Any deposits after 1st of November will lead to your loss…"Please pass your message to your relatives and friends especially to those who are in remote areas. Let us all go and deposit our bond notes to the banks before they become valueless. Do not be caught off guard hoarding the bond notes until they become valueless."

Speaking at the Institute of Administration and Commerce annual conference here, Dr Mlambo said RBZ was considering opening social media accounts to be able to give citizens official communication as opposed to social media hoaxes.

"The message that the RBZ wants all bond notes by 1 November 2017 is definitely not from us. The bond notes have no expiry date and as long as that facility is still available we shall continue using the bond notes," he said.

Dr Mlambo however said RBZ could roll out more coins than notes when it releases the next batch of $300 million to guard against abuse of the facility.

RBZ has to date poured into the market $194 million out of $200 million bond notes facility since introduction last year.

The bulk of the notes are however being held in the informal sector where they are being used for black market transactions. Dr Mlambo said the $300 million will only be released once the $200 million was exhausted as the Central Bank seeks to find ways of ending the parallel market.

"The $300 million is available but we will only put it once we exhaust the $200 million bond notes facility, which we haven't," he said.

When participants asked how possible it is to introduce coins instead of notes, he said: "I strongly feel the next batch of bond notes should be in coins. This is not official yet but I hope the idea can become a policy. If we can have $1, $2 and even $5 in coins I think we can be able to fight the current situation."

Dr Mlambo said hoarding of cash, which is fuelling the black market, was a result of people's lack of confidence in the banking sector hence they keep money as a commodity.

He said bond notes remain a legal tender.

"The issue of black market came as a surprise. We thought people wanted the United States dollar but now they are feeding the black market. We need to find a way of bringing back the formal sector and also make it attractive for people to keep their money in banks," said Dr Mlambo.

He castigated those fuelling the black market saying RBZ will not tolerate such criminal activity, where some dealers use a three tier pricing system.

"The Central Bank is not buying any foreign currency from the black market as being alleged by some people," said Dr Mlambo.