Brief Analysis Of "The Dirty US$ And 10% Charge"

5 years agoWed, 03 Apr 2019 15:24:10 GMT

Brief Analysis Of "The Dirty US$ And 10% Charge"

Reports suggest that Zimbabwean Banks now charge their customers a 10% charge for depositing dirty USD. One of the banks is the Standard Chartered Bank. The main question many have been asking is the reason behind this move.

The answer to this may have been captured in a Techzim blog. A direct quotation from the blog reads:

It’s those dirty notes that are not accepted in South Africa. We visited another Bureau De Change two days later and it declined some USD notes for the same reason. So, two the Bureau de Changes only took the clean ones (USD notes) and returned to us the dirty ones.

A Financial Gazette correspondent claims that Banks continued accepting dirty USD since 2009 because distributing them was easy. They would just dish them to their customers. The disappearance of the USD from the market and introduction of the Bond currency forced banks to start exporting them. Although exportation was for a price, it was better compared to accepting the now RTGS balances which were no longer backed by the USD.

The correspondent further suggets that South African banks became wary of US sanctions on Zimbabwe. Consequently, they stopped dealing with Zimbabwean banks. They might have

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The charging of a 10% charge by the Standard Chartered Bank is suggestive of the availability of new markets for the dirty notes. The markets must be charging about 10% to depositors of dirty USD notes.