Bianca Mlilo, Business Reporter
RETAILERS have implored the Government to double its 2017 target of Point of Sale (POS) machines as the country moves closer towards fulfilling the financial inclusion strategy.
The Reserve Bank of Zimbabwe has set a target to distribute 50 000 Point of Sale machines across the country to promote the use of plastic money, which retailers say might not be enough. This move is set to reduce queuing at banks for hard cash.
Due to a cash shortage that the country has been experiencing since last year, RBZ has encouraged the public to engage in plastic money transactions.
The uptake of electronic transactions has been encouraging, with RBZ saying they now account for 50-70 percent of all transactions recorded by most major retailers.
Confederation of Zimbabwe Retailers president Mr Denford Mutashu said although retailers applauded the set target, there was capacity to reach more people even in rural areas. The central bank, together with CZR has embarked on a programme to promote the use of credit and bank debit cards in the rural areas to ease the country’s cash shortages.
RBZ deputy director financial markets Mr Josephat Mutepa last week said RBZ had since engaged stakeholders to review bank charges in order to attract more people to embrace the use of plastic money.
“The target of 50 000 POS machines by year end is achievable, although it is a bit far off the mark. We believe that it’s too small a figure,” said Mr Mutashu.
“It would be much appreciated if the Reserve Bank could double that figure and roll out 100 000 of these machines. These would be enough to cover even the remotest of areas where people still walk tens of kilometres to access money.”
Mr Mutashu said this would also contribute to the achievement of Zim-Asset goals. The financial system, as espoused by Zim-Asset, plays an important intermediary role that involves mobilising domestic resources and efficiently channelling them into productive activities.
On the 15 percent Value Added Tax (VAT) which now applies to meat products and cereals (previously zero-rated goods), Mr Mutashu said so far they had not detected any anomalies in the pricing of the affected goods.
Previously, products such as rice, fish and meat were exempted from the 15 percent VAT, which has largely made the prices of these basic commodities relatively cheap and affordable to low-income earners.
The new tax regime, which came into effect on 1 February was introduced by Finance and Economic Development Minister Patrick Chinamasa under Statutory Instrument (SI) 20 of 2017 and affects all meat products — including offals and fish — rice, mahewu and margarine. The SI effectively lifts the tax exemptions on most meat products and cereals. Retailers had, by Friday increased the prices of the goods by 15 percent to cover the VAT. However, the retailers’ representative body said it was still monitoring the situation on the ground.
Mr Mutashu urged consumers not to panic, saying the market would self-correct and there would be no arbitrary raising of prices because of the stiff competition.
“We are hoping for the best with regards to SI 20, and we hope people will come to appreciate it, as was the case with SI 64 of 2016, which helped our industry a lot. We do not believe there will be any need for the Government to impose price controls because no one would want to take advantage of the SI. It would be detrimental to the retailer,” he said.