Banks Introduce Exorbitant FCA Charges

INDIVIDUALS and corporates will have to part with between US$30-50 a month in bank charges when they make transactions with their foreign currency accounts (FCAs).


Foreign currency denominated accounts can be activated within 24 hours with zero balance and can be operated in five major currencies –– the US dollar, euro, British pound, South African rand and Botswana pula.

FCAs’ individual and corporate charges are however said to be “ridiculously high”’ as Zimbabweans are failing to make ends meet due to high consumer goods and services prices, school and tertiary fees and rentals.

Figures obtained by businessdigest from commercial banks this week show that for an individual to withdraw money, they are charged between US$0,50 and US$3 for every transaction while corporates are charged up to US$10 per transaction.

To be issued with a draft/RMO, individuals and corporates are parting with between US$8 and US$12.

Telegraphic transfers cost between US$18-25 for both corporates and individuals. The same amount is being charged for deposits received by telegraphic transfers.

Banks are also charging as much as US$20 for deposit of bank notes for each transaction.

Individuals are either not being charged to maintain their accounts or are parting with anything below US$3 depending on the bank. Corporates are being charged between US$8 and US$12 per month for monthly account maintenance.

FCA inter account transfers cost between US$1 and US$4 depending on the bank for both individuals and corporates.

Service charges for salary processing tariffs cost between US$1 and US$3 per entry for manual salary payments.

Companies will be charged between US$7 and US$10 per payroll for late salary submissions.

Most banks have not set a charge for intermediated money transfer tax. Unclaimed salaries for other employees cost between US$4 and US$7.

Facility negotiation fees for corporates cost 5% of the value of the overdraft or loans.

Between US$4 and US$8 is being charged for stop orders. Accounts closed within six months are attracting a fee of between US$18 and US$25, while reactivation of a dormant account costs between US$20 and US$25.

Services for bonds guarantees, securities and indemnities and bills range from 5% and 10% of the amount at hand.

Charges for letters of guarantee, and guarantees are between 4% and 6% of the amount involved.
Letters of credit –– foreign inward –– cost US$75 per credit. Foreign outward for commercial banks cost 10% of the amount being transacted.  

Barclays Bank is advising its customers on how they can control their banking costs.

“Make use of alternative methods of transacting such as making use of the cash machine (ATM) to withdraw cash, rather than cashing cheques in the banking hall. Draw cheques to cut down your transaction costs,” said Barclays.

“Frequent small cash machine (ATM) withdrawals will cost you more than making larger, less frequent withdrawals. Ensure sufficient funds in your account before issuing a cheque to avoid penalty fees. The bank will not pay against uncleared effect,” Barclays said.

The move by the Reserve Bank to encourage everyone to have an FCA is viewed as the final humiliation for Zimbabwe’s defenceless dollar.

BY PAUL NYAKAZEYA