Cash transactions decline 12% in April, credit to Govt up 6%: RBZ

Reserve Bank of Zimbabwe

The value of card based transactions stood at $427.7 million, down from $430.9 million registered in March. In value terms, total cheque transactions fell to $9.7 million from $11.3 million.

CASH transactions declined 12.1% in April to $703.3 million from $800.4 million in March while the transactions processed through the Real Time Gross Settlement system increased 3% in response to the cash shortages which have seen a shift to electronic payment systems.

The shortage of cash is attributable to a number of factors that include the depletion of bank nostro balances, the dysfunctionality of the multicurrency system as the country is now predominantly using US$ and the loss through externalisation.

The Reserve Bank of Zimbabwe monthly report for April however shows that the value of transactions processed through the national payment systems declined 1.2% to $6.15 billion in April from $6.23 billion the previous month as the economy continues to slow.

Transactions processed through RTGS increased 3% to $3.56 billion from $3.46 billion the previous month. Correspondingly, the volume  of  transactions increased by 6% to 161 725 from 152 465.

The total value of mobile and internet based transactions declined by   11.5%, to   close at $595.6 million in April from $673.1 million in March as mobile wallets operate on cash interface.

The value of card based transactions stood at $427.7 million, down from $430.9 million registered in March. In value terms, total cheque transactions fell to $9.7 million from $11.3 million.

According to the report, the annual growth in broad money supply stood at 12.8% in April 2016, up from 12.5% the previous month. Month -on-month, broad money supply increased to $5 billion from $4.91 billion in March.  Increases in savings, 22.6%; demand, 21.3%; and long term deposits, 18.3%, accounted for the annual growth in broad money supply. Short term deposits, however, decreased by 24.1% during the period under review. The proportion of deposit classes to total deposits was demand, 52.9%; over 30-days, 18.3%; under   30-days, 14.9% and savings deposits, 13.9%

On an annual basis, growth in total banking sector credit rose to 23.8% from 23.5% in. Monthly banking sector credit increased 1.5% to $5.62 billion.  Credit to Government increased 6% to $1.8 billion after there was an increase in treasury bills issued.

Credit to the private sector recorded an annual decline of 3.4% to $3 .63 billion in April $3.76 billion in April 2015. On a month-on-month basis, credit to the private sector has remained almost the same from $3.67 million in March.

Credit to the private sector consisted of loans and advances, 85.2%; mortgages, 9.2%; other investments, 5.2%; banker’s acceptances, 0.3%; and bills discounted, 0.2%.

The sectoral distribution of private sector credit was as follows: agriculture (23.2%); households (19.0%); manufacturing (15.8%); services (15.2%); distribution (13.7%); mining (5.1%); financial organisations and investments, (3.0%); transport   and   communications (3.0%); and construction (1.7%). The utilisation of private sector credit in terms of proportions was as follows: Inventory build -up, 33.6%; working    capital, 36.2%; consumer durables, 14.9%; fixed    capital    investment, 13.5%; and pre and post shipment financing, 1.7%.

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