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Retailers to Address Small Change Shortage by Approaching Banks for ZiG Coins

A till operator collects new bond notes from a shopper at a supermarket in the capital Harare, Zimbabwe, November 28, 2016.REUTERS/Philimon Bulawayo
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Harare, Zimbabwe — In an effort to resolve the acute shortage of small change that has plagued the country since last year, Zimbabwean retailers have pledged to approach banks to obtain ZiG coins and small-denomination notes.

This move comes after the Reserve Bank of Zimbabwe (RBZ) highlighted the availability of these denominations, despite slow uptake by consumers.

The RBZ revealed that banks had already issued a cumulative ZiG55 million of ZiG1, ZiG2, and ZiG5 coins, along with ZiG10 and ZiG20 notes. However, customers have been slow to access this small change at their banks.

During a recent meeting with RBZ Governor Dr. John Mushayavanhu, attended by wholesalers and retailers in Harare, the Confederation of Zimbabwe Retailers (CZR) emphasized the impact of the change shortage on the economy. CZR President Denford Mutashu noted that the retail sector has embraced the ZiG more than any other sector, with most formal retailers’ sales averaging 80% in ZiG and 20% in foreign currency.

“Unfortunately, at the procurement level, 80% is in US dollars and 20% in ZiG, which creates a market imbalance affecting day-to-day procurement patterns of formal retailers and wholesalers. Meanwhile, the informal market benefits from not formalizing their businesses,” said Mutashu. He welcomed the dialogue, aligning with President Mnangagwa’s engagement and re-engagement policy, and pledged to work with banks to address the change shortage.

Dr. Mutashu pointed out that the lack of change has led to price increases, adding financial strain on customers and disrupting the efficient movement of goods and services. Dr. Mushayavanhu acknowledged reports of consumers being unable to receive change when using US dollar banknotes.

“We are receiving complaints that people are unable to get proper change when tendering US dollar notes. Instead of receiving 50 cents change for a US$1.50 purchase, customers are being asked to buy additional items they don’t need,” Mushayavanhu said.

He challenged retailers to proactively seek small change from their banks, noting that there is sufficient stock of ZiG coins and notes. “Have you approached your bank for a float in small denominations? If banks claim they don’t have it, we can intervene because our records show that banks are holding adequate stocks of these denominations,” he added.

The change shortage has also affected the transport sector, with passengers on 50-cent routes forced to overpay or be paired with strangers to make up the exact fare. Transport operators cited limited access to small notes and coins as a major issue and suggested the establishment of small change booths at terminuses.

Despite these challenges, Dr. Mushayavanhu expressed puzzlement at the persistent problem, reiterating that every bank branch has sufficient stocks of small denomination notes and coins.

As the dialogue continues, stakeholders in the retail and transport sectors remain hopeful that increased access to small change will alleviate the current issues and improve daily transactions across the country.