Banks under fire
..RBZ says 'we don't know where they get their shame from'
PHILLIMON MHLANGA
Banks are under fire for imposing punitive fees and charges, enraging depositors and drawing public disquiet from the Reserve Bank of Zimbabwe (RBZ),Business Times can report
RBZ Deputy Governor Dr Innocent Matshe, speaking at the Life Offices Association breakfast meeting in the capital Harare, expressed strong concern:
“Financial institutions should not be making most of their money from fees. Should not be making fees their source of banks. We don’t know where they are getting their shame from. They are getting more than 30% of their income from fees and charges.”
Dr Matshe was particularly scathing of the sector’s reliance on non-funded income:
“Banks are the biggest problem as far as confidence is concerned because they are all focusing on this non-funded income instead of the core business that you lend and get interest.”
Long-suffering depositors have voiced anger at what they call “a bitter pill to swallow.”
Despite Zimbabwe’s weak economy, which has pushed many industries to the brink of collapse, banks continue to post enormous profits, largely generated from fees rather than lending. Many depositors describe the charges as exploitative, particularly given the pitiful interest rates offered on deposits.
“Banks are collecting rent from customers on a monthly basis,” Permanent Secretary in the Ministry of Finance, Economic Development and Investment Promotion, George Guvamatanga, recently said.
“They now say, you have an account where you pay me a rental of US$25 every month or US$20 every month.”
Guvamatanga highlighted the effect on depositors:
“When you make a cash withdrawal of US$1,000, banks deduct a significant portion of your cash. The other place where there is almost robbery is with your own Visa and Master cards. You deposit your money and you attract a commission for depositing your cash.”
He called on banks to reform immediately, saying:
“…charges should encourage people to put their money into the bank.”
The government’s concern is clear: punitive fees risk discouraging people from depositing money, weakening the fragile financial system and slowing economic recovery. For depositors, rising fees have become a source of daily frustration. Many argue that charges are not only punitive but exploitative, draining funds from those already struggling in a fragile economy.
With public trust in the financial sector at risk and banks’ profits increasingly dependent on punitive charges rather than traditional lending, Zimbabwe’s banking sector faces urgent pressure to reform—or risk further alienating depositors vital to economic recovery.
