Forex Dealers Trade Dirty Rand And US Dollar Notes3 years ago
Some street hustlers in Harare are now buying dirty smaller denominations of US dollar and rand notes at half the value which they then sell to importers.
This comes on the back of the rapid dollarisation of the economy as the local currency, re-introduced just over a year ago, has fallen in value at a rapid rate.
Zimbabwe recently introduced a foreign currency auction market, under which 1 US dollar buys 65.8 Zimbabwe dollars. The street rate, meanwhile, is US$1: ZWL85.00.
This means that, on the streets of Harare, a US dollar can be exchanged for more Zimbabwe dollars than the official government rate.
One of the cash hawkers, who only identified himself as Eddy, told Fin24 in an interview at an informal settlement some 37 kilometres outside Harare’s business district that he buys soiled rand and US dollar notes, which in most cases are not acceptable in the supermarkets and other shops. He said:
The deal is that importers utilise that money to pay for imports through the banks, because the notes cannot be directly banked or deposited, but are acceptable as payment for imports through the banks.
We buy the soiled notes at half the value and put a premium when we sell to the importers, who then use the soiled notes instead of the clean bills they get when re-selling their products in cash on the market.