On 5 April 2024, the Reserve Bank of Zimbabwe (RBZ) Governor, Dr John Mushayavanhu, announced the Zimbabwe Gold (ZiG) as the new currency to replace the inflation-battered Zimbabwe Dollar (ZWL).
Prior to the Monetary Policy Statement on 5 April that introduced the new currency, there was a barrage of information, some untrue, that hinted at what was to come. The flurry of information multiplied after the official announcement.
The introduction of ZiG has shaken normal transacting for the public and business owners, owing mostly to financial institutions' systems' migration to ZiG and to the impending death of the ZWL notes. A lot of misinformation and disinformation has left the public confused over the ZWL and ZiG. Over the past week, the Reserve Bank of Zimbabwe has explained and clarified facts regarding the new currency and the window period in which the old currency will be valid. This article seeks to relay some of the facts surrounding ZiG and the transition from the Zim dollar.
Fuel Purchases In ZiG
Members of the public have been questioning if they will be able to pay for fuel using ZiG.
In a Q&A published on 9 April, the Central Bank said, "The current pricing mechanism in the fuel sector will remain in place until otherwise reviewed. As the Reserve Bank and Government work towards wider use of ZiG, the fuel sector will be encouraged to accept ZiG for fuel purchases."
Speaking at an engagement with the business community today, RBZ Governor Dr John Mushayavanhu reiterated that the multicurrency system will be in place until 2030. He added that to avoid fuel queues, fuel will continue being sold in US dollars, "So we have up to 2030 buying fuel in USD."
Change Woes In Shops And Kombis
Since last week, commuters have been facing challenges when using public transport. For distances that cost US$0.50, some operators are rejecting the local ZWL and rounding fares off to US$1. Before the introduction of ZiG, ZWL notes were already scarce.
The RBZ explained, "The Reserve Bank would like to reiterate that the ZWL$ notes currently in circulation are still valid and remain legal tender until 30 April 2024. Accordingly, the ZWL$ notes
should continue to be used for transactional purposes at the announced ZiG/ZWL$ conversion factor of 2498.7242."
Read More: RBZ Cuts Policy Rates To 20 Percent, Bets On New Currency
Utilities Payment And Banking Transactions Using ZiG
On 5 April, the RBZ gave businesses, banks and financial services a week to configure systems to ZiG. As a result, most services were unavailable for days immediately after that. The public could not buy electricity tokens, pay Council rates digitally or buy local currency airtime online.
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The Bank commented on 9 April, "Commendably, over 90% of the banking institutions and mobile bank service providers have successfully configured their systems and processes from ZW$ to ZiG, with banking services now being accessible for the convenience of the transacting public."
When Will ZiG Notes Enter The Market
RBZ Governor Dr Mushayavanhu said the new currency will be rolled out into the market on 30 April 2024.
