Latest News Editor's Choice


News / Local

RBZ chief warms up to fintech

by Staff reporter
26 Feb 2021 at 06:48hrs | Views
THE Reserve Bank of Zimbabwe (RBZ) says it will create a financial technology (fintech) regulatory sandbox that is likely to transform the banking sector.

According to Investopedia, fintech is new technology that seeks to improve and automate delivery and use of financial services. At its core, fintech is utilised to help companies, business owners and consumers better manage financial operations, processes, and lives by utilising specialised software and algorithms that are used on computers and, increasingly, smartphones.

RBZ governor John Mangudya last week said establishing a fintech regulatory sandbox was meant to allow entities to list their financial products, services or solutions within a controlled environment.

"The fintech regulatory sandbox which will be housed at the bank will be open for financial innovation with effect from 1st March 2021," Mangudya said in his 2021 Monetary Policy Statement.

"The regulatory sandbox guidelines are being finalised and will be accessed from the bank's website," he added.

Financial services firm, PWC says a regulatory sandbox allows fintech players to experiment with innovative financial products under regulatory supervision with well-defined space and duration.

The presence of appropriate safeguards helps in containing consequences of failure. This move comes amid lobbying for Zimbabwe to embrace cryptocurrencies and other fintech products. The RBZ chief also increased the bank policy rate for overnight accommodation from the current 35% to 40% per annum and the medium-term lending rate for the productive sector lending from 25% to 30% per annum.

"The decision on interest rates takes into account the current liquidity conditions in the market and the need to continue controlling speculative borrowing," he said.

Manguya also increased statutory reserves from 2,5% to 5% for demand and call deposits, while time deposits were maintained at 2,5%.

Source - newsday

Subscribe

Email: