8 January 2013

Zambia: Cross-Border Traders Hit Setback With Rebased Currency

CROSS-BORDER traders have said they are facing a lot of challenges in transacting and exchanging the new rebased currency as most of the people in neighbouring countries have not yet familiarised themselves with the new Kwacha.

In separate interviews in Lusaka cross-border traders said people in the neighbouring countries were finding it difficult to come up with the rebased exchange rates as most of the people preferred to transact in the old currency to avoid confusions.

Lloyd Mulenga, who imports hardware from Tanzania, said most of the people in the neighbouring countries were refusing to accept the new currency in that they are finding it difficult to convert or exchange the money accurately.

"The exchange rates are a little bit confusing, especially in shillings, because we used to pay more now that our currency has been rebased the amounts are going into decimals which was not the case previously," he said.

Hilda Phiri, who imports second hand clothes from Malawi, said exchanging the new currency was a challenge, especially that most of the people in countries like Malawi lacked information about the new currency.

And a survey at various business points in Lusaka has revealed that marketeers are failing to understand the link between

the old and the new currency, especially when it comes to giving out change.

It was also learnt that most marketeers and other residents had not fully understood the conversions of the new small denominations which had led them to rejecting the new notes altogether.

In separate interviews, marketeers and some members of the general public said they were finding difficult in dealing with the old small notes like K500, K100, K50 and K20, saying some big notes, like the new KR100, the KR50 down to KR1 had less challenges in converting but for the low value ones people were confused.

Bernadette Mwale, who sells caterpillars at Lusaka's Kalikiliki Market, said K50 and K500 were difficult to convert in that some customers were confusing the notes, saying this had led to them starting to reject the new notes.

"Since the new Kwacha was introduced on January 1, 2013, sometimes you find that instead of giving a customer five Ngwee change, you give out K5 and when I discovered that I was making losses in my business, I decided to only accept the old currency because I understand it better" she said.

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