Staff Reporter

The Reserve Bank of Zimbabwe (RBZ) has raised alarm over millions of dollars lying idle in cash deposit boxes across the country, warning that this growing trend among businesses is depriving the economy of essential liquidity.

Announcing the 2025 Monetary Policy Statement, RBZ Governor Dr. John Mushayavanhu condemned the practice, describing it as a major setback to economic growth and financial stability.

Dr. Mushayavanhu highlighted that some unscrupulous manufacturers, who supply goods to the informal sector, are failing to bank their proceeds, and preferring to stash large amounts of cash outside the formal banking system.

He stated that such financial disintermediation is not only harmful to the economy but also violates anti-money laundering regulations.

“There are manufacturers who are supplying goods to the informal market but are not banking their proceeds. They are keeping these monies in their cash boxes, which is not in line with the Anti-Money Laundering Act. The Financial Intelligence Unit (FIU) will not just watch but will dismantle this practice,” he warned.

Beyond being an economic risk, hoarding large sums of cash also poses a significant security threat.

Dr. Mushayavanhu cited cases of cross-border traders and businesses falling victim to robberies due to carrying large amounts of physical cash. He urged businesses and individuals to take advantage of modern banking solutions, emphasising that the RBZ has made it easier to transact electronically.

“The issue here is that robbers were waylaying buses, especially cross-border traders, and robbing them of their cash. There is no need to keep cash when one can simply upload their money onto a prepaid card, which now has an increased limit of up to US$1 million. We have also adjusted interest rates on savings accounts, which makes huge sense for people to bank their money,” he said.

As part of efforts to promote a culture of saving and restore confidence in the financial sector, the RBZ has implemented an incremental increase in interest rates on savings accounts. This move is expected to incentivise businesses and individuals to deposit their money in banks rather than hoarding it, ensuring that more funds circulate within the economy.

Moreover, the Government’s push for financial discipline is aimed at stabilising the economy and ensuring that all financial resources contribute to national growth. Businesses operating outside the formal banking system may soon face regulatory scrutiny.