Diaspora remittances to top $1 billion this year: Central bank

by Gabriel Masvora | Sunday, May 10, 2015 | 1798 views

INTERNATIONAL remittances inflows into Zimbabwe are expected to top $1 billion this year up from $837 million last year as the Reserve Bank moves to liberalise the transfer of money into the country.
Reserve Bank of Zimbabwe Exchange Control divisional director Mr Moris Mpofu said on Friday that the central bank had opened a number of opportunities that would see more players joining the money transfer sector to boost the inflow of money.

“This year we expect to see an increase in the diaspora remittances. The central bank wants to ensure that more players are licensed in the sector,” he said.

RBZ principal inspector Mr Obvious Runesu said the central bank had come up with a three-tier system that categorises those who want to join the money transfer business.

Tier one, he said, would see players paying a collateral of $100 000 that would be used to cushion send customers from business collapse or delivery time.

“Those who wish to join Tier two do not necessarily pay collateral deposit. They pay a collateral deposit of $50 000 if dealers use their own system to collect from customers for send transfers as well as payout to beneficiates,” he said.

Mr Runesu said Tier three would open to small-scale players and they did not necessarily have to pay any collateral deposit but just notify the RBZ on their business and how they were trading the currencies.

Mr Runesu said Zimbabwe had over the years seen an increase in the number of remittances from the diaspora.
It is estimated that between 2,5 and 3 million Zimbabweans are in the diaspora.

“Total remittances from the diaspora amounted to $837 million in 2014, up from $790 million released in 2013. About six percent of Zimbabwe’s 2015 Gross Domestic Product of $14,068 billion and about 23 percent of exports of $3,677 billion,” he said.

He said diaspora remittances last year overshadowed Foreign Direct Investments, Portfolios Investments and Official Development Assistance.
Figures from the central bank showed that major sources of remittances were South Africa, the United Kingdom, Botswana, Canada and Australia.

About 88 percent of Zimbabwean diaspora, according to the central bank are in South Africa and contribute about 33 percent of remittances into Zimbabwe.

The figures also showed that 5 percent of Zimbabweans in the diaspora were in the United Kingdom and contributed about 23 percent of the remittances.
Those in America contribute about seven percent, Botswana five percent, Canada two percent and other 80 countries contribute 23 percent.

RBZ data showed that Zimbabwe has 223 Money Transfer Agencies including 82 postal services in the rural areas.
Local mobile telephone operators have also joined in the business, partnering with international money transfer agencies to ensure that money can be directly transferred from abroad into mobile wallets locally.

 

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