Parly raps bank charges hike

HARARE - Parliament on Monday grilled bankers over increased bank charges following the expiry of an agreement putting a cap on interest rates and fees banks could levy.

Legislators accused local financial institutions of pushing the majority of depositors out of the banking sector through exorbitant bank charges and high interest rates.

Around $2 billion is estimated to be circulating outside the banking system.

Brian Tshuma, an MDC MP for Hwange Central, questioned bankers’ motive in raising charges at a time most people’s incomes are depressed.

“I want to understand why you bankers are continuously increasing bank charges. This kind of behaviour does not encourage our people to bank,” he said, further asking “who would want to leave their money in the bank when at the end of the month most of it is taken up by charges?”

A snap survey by businessdaily revealed that since January this year banks have increased charges by an average of 50 percent.

Last year, banks signed a Memorandum of Understanding (MoU) with the Reserve Bank of Zimbabwe (RBZ) effectively pegging lending rates at 12,5 percent, while cash withdrawal fees were set at a maximum of five percent with a minimum of $2,50 and ledger fees, maintenance and service fees of $4 per account.

During the MoU’s tenure, which expired last November, banks — through the Bankers Association of Zimbabwe (Baz) — warned that the banking sector stood to collectively lose $73 million in potential income as a result of the agreement.

Acting central bank governor, Charity Dhliwayo, recently urged financial institutions to upgrade their core banking systems and delivery systems to promote efficiency.

Comments (3)

Banc ABC is robbing civil servants on loans. The bank's operations must be investigated Gvt must take action and protect civil servants.

P Gwanetsa - 13 March 2014

Banks are reaping us off, take for example stanbic, with minimum balance of $20.00 per client, not interest gets accrued on that at the end of the month, yo balance gets way below the $20.00 mark if not negative! That is cheating at its best! we expect our money to grow not to find our accounts eroded by bank charges!

George - 13 March 2014

banks are reapings us especially stanchartered bank, please their interest rate on loans is to high

mutsa - 14 March 2014

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