Dumisani Nsingo, Senior Business Reporter
THE rampant disregard of monetary regulations by some retail outlets has exacerbated the prevailing liquidity crunch in the country, an official has said.
Confederation of Zimbabwe Retailers president Mr Denford Mutashu said there was a need for the Government to come up with measures to ensure that operations of the informal sector are accounted for so as to guard against illicit activities such as tax evasions and money laundering.
“The Government must swiftly move and ensure that each and every trader is accounted for. Each and every shop must be regulated and known what they are selling and where they are getting what they are selling from and basically known if they are banking their proceeds because this has continued to cause issues in terms of liquidity challenges because a lot of the informal sector are not banking and a lot of them are not even willing to take up (Point of Sale Machines) swipe machines.
“What we believe is the way to go as a country is that anyone who opens a business should be accountable because you can’t trade as you wish and still not be accountable to a certain authority. You need to follow the law to the letter but here in Zimbabwe there is wanton disregard of market discipline and of course following the law itself. So I think it’s something we need to ask Government to come through and work on,” said Mr Mutashu.
He said a survey carried out by CRZ also revealed that a number of retailers were insisting on cash as the only mode of payment while others were insisting on multi-tier pricing for different modes of payment.
According to the Bank Use Promotion Act (Chapter 24:24), it is an offence to use different pricing models for different payment systems namely cash, Real Times Gross Settlement, internet and Point of Sale or a combination of any two or more of them.
“A lot of shops being owned by foreigners, especially those that are into selling of textile materials, are simply disregarding the law and we have visited a lot of them on a fact finding mission and some of them are even refusing the other modes of payments and simply insist on cash payment but customers and the general public don’t have the cash so they are shortchanging the consumers.
“Even if they are foreign owned retailers, we want them to comply with the law because if they’ve got operations within their countries, I don’t think they are operating outside the law. So we believe we can get a solution for that and we have continued with the engagement process. At the same time we have also asked the Reserve Bank of Zimbabwe to take a firmer hand to ensure that those that continue with that practice should face the full wrath of the law,” said Mr Mutashu.
RBZ has since deployed teams on the ground to deal with issues of indiscipline by some traders who insisted on multi-tier pricing for different modes of payment. He said CRZ was engaged in an outreach programme to promote the use of plastic money.
“We are seized with promotion of plastic money across the realm of the country and to that regard we are working with the regulator, the RBZ to continue with outreach programmes. Reaching out to those marginalised rural areas . . . because we believe that, yes, a lot of people might not be banking but the fact that a lot of Zimbabweans now own mobile phones that on its own is something that we should use as a leverage because plastic money encompasses the use of swipe cards, POS machines as well as mobile money.
“So we are hoping that the three percent figure of people that are currently using plastic money together with mobile money will have to increase given the cash shortage and the liquidity crunch that the economy is faced with. Indeed if you look at the shops about 80 percent of the sales revenue on a daily basis is attributed to plastic money. So I think this works to change the perception and the mindset because people are still used to carrying cash wherever they go. They want to be holding the cash on their palms. It’s a mind shift that we need to work on,” said Mr Mutashu.
Bulawayo United Residents’ Association chairperson Mr Winos Dube said the multi-tier pricing for different modes of payment being undertaken by some retail operators was tantamount to exploitation of consumers.
“We have had disparities in the price of commodities for different mode of payments for quite some time and I must say we are disappointed that the relevant authorities are not taking action. What these retailers are doing is more of exploiting the public and it’s high time we need the Government to protect the masses through enforcing a law that protect the citizens of our country,” said Mr Dube.