The Reserve Bank of Zimbabwe (RBZ) has allowed companies to pay their workers in foreign currency but the employees will not be able to with draw cash from their NOSTRO accounts.
In a circular to all financial institutions in the county at the weekend, the Central Bank said the funds in the individual NOSTRO accounts if not used will within a calendar month will be liquidated.
RBZ also gave terms and conditions which must strictly be adhered to.
“There shall be no cash withdrawals from these particular accounts funded under this arrangement,” RBZ said.
“However, should there be a genuine need for cash to be withdrawn from the accounts, specific applications must be made to the Reserve Bank of Zimbabwe and supported by letters written by the account holders detailing the reasons and circumstances surrounding such requests.”
Added the circular: “The absence of cash withdrawal facilities is also extended to offshore travelers who must load their MasterCard prior to departure.”
According to the circular, foreign currency in these accounts may, however be used settle bona-fide foreign payments “wherein the bank shall ensure that goods and services paid for are fully accounted for through submission of relevant documentation to be scrutinised and approved by either the Branch Operations Manager or Branch Manager who must annotate foreign payments from the NOSTRO FCA accounts.”
The Central Bank added that such foreign payments should not include offshore investments or transfer to offshore accounts as well as domestic inter-FCA transfers.
It warned against the abuse of the facility.
“Branches must maintain a register for tracking the funds in the individual NOSTRO accounts and MasterCard to curb the abuse and facilitate liquidation after the 30-day period,” RBZ said.
“Prior to processing transactions for this category of account holders, a statement enquiry (operating account and MasterCard) to check and ensure that the transaction is within the limit of the amount authorised as per salary proceeds credited and that the MasterCard has not been reloaded from another branch.”
“Any unutilised balances in the individual NOSTRO FCAs shall be compulsorily liquidated after 30 days from the date of salary payment at the prevailing interbank rate.”