HomeNewsDepositors feel the pinch of unrealistic bank charges

Depositors feel the pinch of unrealistic bank charges

BANKS are making a killing in withdrawal fees in banking halls amid concerns that the charges are taking a toll on depositors.


This comes after the central bank in December removed a cap it had placed on bank charges and interest rates.

Last year banks and the Reserve Bank of Zimbabwe (RBZ) signed a Memorandum of Understanding (MOU) where banks were ordered to waive bank charges on deposits of up to a maximum of US$800.

Banks also agreed that any term deposit of US$1 000 and above held over a period of at least 30 days and above should attract an interest of at least 4% per annum. RBZ was however forced to scrap the MOU effective December 1.

The MOU was supposed to have been renewed this month.

A survey by The Standard yesterday showed that banks were charging between 0,75% to 1% of the amount to be withdrawn.

This means for civil servants earning about US$400, an average of US$3 will be charged for withdrawing the money inside the banking hall. At the Automated Teller Machine (ATM), that depositor would be charged US$2 per transaction.

The survey showed that banks were charging a monthly service fee of US$4. It also revealed that banks were not doing enough to educate depositors on how to use ATMs.

A CBZ depositor told The Standard yesterday that he was resorting to withdrawing money from the ATM as it was cheaper than getting the same service in the banking hall.

He said a bank teller alerted him of the huge difference when he wanted to withdraw US$ 2 600 on Wednesday.

“They told me it would cost US$19,50 as compared to just US$4 I would have incurred if I had used the ATMs to make two withdrawals,” he said.

CBZ’s maximum ATM withdrawal is US$2 000 per day for savings accounts.
High bank charges have been a bone of contention between depositors and banks.

In her maiden monetary policy recently, RBZ acting governor, Charity Dhliwayo said in the absence of the MOU, banks were required to justify increases in their charges or interest rates from the October 31 levels before approval was granted.

Dhliwayo said the move would assist the regulator in monitoring “collusion” on pricing, as well as evaluating banks’ cost structures in relation to bank charges.

She said banks were required to upgrade their core banking and delivery systems to promote efficiency.

“This will assist in reducing the cost of service delivery which translates to lower charges for the banking public. The cost considerations by banking institutions should be offset by the cost savings that are reaped from efficient and automated processes,” she said.

Dhliwayo said banks should be innovative in the delivery of products and services and seek to continuously improve on efficiency by leveraging on technological advancements.

This, she said, would enable them to design products and tiered pricing structures which suited the circumstances of low-income groups.

“Empirical evidence indicates that banks’ strong reliance on charges to cover operational expenses is a reflection of inefficiencies in service delivery,” the RBZ chief said.

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