Zimbabwe’s retail and banking sectors slipped into an unprecedented crisis after banks struggled to cope with an implosion of zeros in the country’s besieged currency, plunging the point-of-sale transaction system (POS) in a dilemma.
Bankers said their systems had been overwhelmed to the point of almost crippling after a sharp increase in zeros on the country’s currency in late June and the first week of that month, forcing some banks to “manually feed wages and other payments’ of depositors.
“We had to remove the zeros from the numbers in our systems, but the zeros present a major challenge as they accumulate every day,” said one banker.
VISA POS terminals, issued by UK-owned Standard Chartered Bank, do not accept transactions from other VISA-related banking institutions such as MBCA Bank, NMB Bank, Barclays Bank and Stanbic Bank.
Buyers have gathered outside the POS terminals of CABS, a subsidiary of Old Mutual Plc, and Kingdom Bank, which have Zimswitch facilities shared by most banks. As a result, most supermarkets using these POS machines had long queues of downed shoppers waiting their turn at POS terminals.
A buyer at a Five Avenue Spar supermarket in Harare said he waited six hours before he could buy his small grocery store.
“You have to be patient because just one day with your money in the bank is a huge loss as prices change every day,” said Dumisani Nyathi, holding a small grocery item.
Cashiers have to perform multiple transactions for point-of-sale purchases over $ 10 billion due to the high number of zeros. The cheapest package of meat costs more than $ 200 billion, or 20 transactions, while a loaf of bread, barely available in the formal market, sells for $ 50 billion, or five transactions at a terminal. point of sale.
“Most buyers don’t have cash because the minimum daily withdrawal limit is $ 100 billion, which really doesn’t buy anything. So POS machines are the alternative, but it is a nightmare for both our staff and customers as a single transaction can take up to 30 minutes, ”said supermarket manager Tawanda Gurupira.
Some point-of-sale terminals rejected transactions from banks that suppressed zeros because they were transmitted as having insufficient funds.
Reserve Bank of Zimbabwe Governor Gideon Gono slashed the Zimbabwe dollar by three zeros in August 2006 after inflation ruined the currency, pushing transactions into billions of dollars. But the zeros appear to be back in force, with most transactions reaching billions of dollars.
The country currently has at least 27 recently introduced types of banknotes of different denominations in circulation, but most have already become obsolete due to inflation. The highest is currently a $ 50 billion agribusiness check introduced in May. The country has been printing bearer checks since 2003 because the rapid erosion of the currency has made printing real money untenable.