Bond coins start circulating today •move to ease small change woes •RBZ allays fears of Zimdollar return
Banks will today start circulating the Reserve Bank of Zimbabwe’s imported bond coins, in a move expected to ease the problem of small change that has been bedevilling the economy since the advent of the multi-currency regime in 2009. The coins will be distributed by RBZ through normal banking channels in denominations of 1c, 5c, 10c and 25c, while the 50c coin will be introduced later.
Similarly, rand coins of 10c, 20c, 50c R1, R2 and R5 worth about R30 million will also be imported to complement the special bond coins.
RBZ Governor Dr John Mangudya told The Herald yesterday that the coins were a good store of value.
“The coins are good value for money as they will not suffer from cross rate fluctuations as has been witnessed with the rand coins,” he said.
“As the central bank, we urge people to feel free to utilise them as they are at par with the United States dollar.”
A total of $20 million worth of bond coins will be imported alongside R20 million worth of rand coins to augment existing stock.
However, the first batch that will be released today has $10 million worth of coins.
Contrary to perception that the coins herald the return of local currency, Dr Mangudya said they were meant to complete the series of US dollar notes.
“The bond coins which were minted outside Zimbabwe are to be anchored by a $50 million bond facility from Afreximbank.
“The coins will ease the problem of small change and eliminate the problem of rounding up of prices to a dollar where there is no option to buy more goods and ease the hassle commuters go through trying to break up a dollar to find change.”
The importation of bond and rand coins is envisaged to result in a price correction mechanism that largely benefits consumers and retailers alike.
Analysts say the economy might see correct and fair pricing of goods and services, while at the same time enabling corporate consumers to fully account for transactions with retailers.
The Bankers Association of Zimbabwe has said the coins will be available at all bank branches country wide, with the association encouraging its members to have adequate stocks in place to meet consumer demand.
“Coins will be issued at no charge by banks in exchange for equivalent currency in USdollars,” said BAZ, adding that the stance has been taken to give convenience to the public at the least cost.
“So, if you ask for US$100 in bond coins, you should tender US$100. Similarly, should you have US$100 worth of bond coins after trading, you should be able to get US$100 is notes or the equivalent multi-currency at any bank branch in Zimbabwe, again at no charge to the customer.”
As financial intermediaries, banks should be motivated by the added convenience to the wider public and the socio-economic benefits of using coins.
“Instead of getting sweets and change vouchers perhaps now parents after shopping can encourage their kids to have piggy banks and tins at home where they can save some coins and help children learn how to save money,” said BAZ.
The banks have also been bearing the direct costs of providing small notes to the public and some of this cost will be ameliorated by the introduction of the coins.