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Chinamasa admits printing money through RTGS system

6 years agoThu, 27 Apr 2017 19:44:30 GMT
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Chinamasa admits printing money through RTGS system

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

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