Minister of Finance and Economic Development Patrick Chinamasa has admitted that the government has used the Real Time Gross Settlement (RTGS) system to print money. This virtual currency some of which was introduced through treasury bills is not backed by United States dollar banknotes that are being imported by banks. The virtual currency which was introduced in the RTGS system can only be backed by a local currency, hence the government’s decision to introduce bank notes despite massive protests from the citizens. The virtual currency is also one of the major causes of bank queues due to the fact that electronic money balances are not backed by hard cash.
Said Chinamasa speaking in Parliament:
Government funds its employees’ salary accounts through electronic transfers over the Real Time Gross Settlement platform. On the contrary, employees would want to obtain physical cash from the banks. This misalignment is the greatest cause of queues at banks for cash as both the Reserve Bank of Zimbabwe (RBZ) and banks would be required to withdraw foreign exchange from their nostro accounts to meet local cash demand.
This shows that we are living beyond our means through borrowing from the market by way of Treasury Bills that translate into government overdraft at the Reserve Bank of Zimbabwe on maturity
More: Financial Gazette
Patrick Anthony Chinamasa is a Zimbabwean politician and a member of the ruling Zanu-PF party. He is the current Minister of Finance and Economic Planning .He was reappointed to the ministry after President Emmerson Mnangagwa had appointed his cabinet in November 2017.Chinamasa is former Minister... Read More About Patrick Chinamasa
The Reserve Bank of Zimbabwe (RBZ) is the central bank of Zimbabwe. Its offices are located at number 80 Samora Machel Avenue in Harare. The Reserve Bank of Zimbabwe operates under the Reserve Bank of Zimbabwe Act, Chapter 22: 15 of 1964. The Act provides... Read More About Reserve Bank of Zimbabwe