FOREIGN currency receipts through money transfer agencies related to the Homelink initiative this week took a knock following moves by the Reserve Bank of Zimbabwe to stop the agencies from m
aking payouts in hard currencies.
Gono said last week all MTA were no longer allowed to make payouts in foreign currency. All payouts under Homelink would now be made in local currency at a rate of US$1: $5 600.
Officials in the money transfer sector this week confirmed that business had been hit by the new ruling.
A senior official with a leading money transfer agency said business had been affected by the new regulation. “We have noticed a downward trend in the receipts from the diaspora since the governor made an about-turn on the Homelink,” said the official. “Business has been low of late. Perhaps it is because people in the diaspora are still digesting the effect of the governor’s decision.”
A manager with a bank that is part of the Homelink family told businessdigest that foreign currency receipts had gone down following Gono’s announcement. “It seems as if people are holding on to their money. We have noticed a general dip in receipts since the monetary policy review,” said the manager.
Prior to the recent policy shift, about 70% of the money sent through Homelink from the disapora was paid out in hard currency, a situation Gono last week said was driving the parallel market.
Analysts have also warned that Homelink might collapse if the new decision is allowed to stand. They say the move is likely to force people in the diaspora to use other irregular means to send money back home. This would provide a large pool of foreign currency to sustain the parallel market.
CZI acting chief executive Farai Zizhou said it was a self-defeating move which would worsen foreign currency scarcity. “People will now go back to the methods they were using before Homelink wase introduced,” said Zizhou. “The auction and the diaspora rate are still not attractive. And if the central bank says they are not paying out in foreign currency then people will stop sending money through Homelink.”
The parallel market is on the rampage with the ailing Zimbabwe dollar trading at US$1: $7 500. It has also lost ground against the strengthening South African rand.
“People will stop sending money through Homelink. There is no incentive to do so,” said economic commentator, John Robertson.