THE Bankers Association of Zimbabwe (BAZ) has urged banking clients intending to undertake foreign trips to pre-notify their banks ahead of their travelling to avoid the failure of using their international credit cards for transactional purposes while outside the country.
Travellers outside their countries of origin use Master Cards or Visa cards to conduct their transactions in other countries.
The two are both widely accepted in over 200 countries and it is very rare to find a location that will accept one but not the other.
Responding to questions, Bankers Association of Zimbabwe president Dr Charity Jinya said customers intending to use the international credit cards needed to pre-notify their respective banks ahead of their travel as well as providing such information as to when they are travelling and the locations where they anticipate using their cards.
“In line with Reserve Bank (of Zimbabwe) Guidelines on foreign travel and in order to combat card fraud, customers wishing to use international cards need to pre-notify their respective banks ahead of travel, providing such information as to when they are travelling and the locations where they anticipate to use their cards. If information provided is incomplete, this may result in challenges,” she said.
Dr Jinya urged customers to seek adequate information and guidance from their respective banks before travelling.
Meanwhile, according to BAZ, daily cash withdrawal limits imposed on locally issued cards remains applicable to withdrawals outside the country.
Customers are also advised that daily cash withdrawal limits imposed on locally issued cards remain applicable to withdrawals at ATMs outside the country, while normal exchange control limits apply on all other purchases and payments effected via cards,” said Dr Jinya.
Economist Dr Bongani Ngwenya said the developments were part of measures announced by RBZ governor Dr John Mangudya to curb leakages on foreign currency. He said although the restrictions make it difficult to transact outside the country, it would not have made any sense if cash withdrawal limits were only imposed locally.
“If there were no restrictions on withdrawing outside the country, we would witness an influx of people taking advantage of this loophole and travelling outside just to access more cash. The same restrictions limiting us domestically apply in foreign travel and according to the RBZ this is the best way to manage the cash crisis we are facing as a country,” said Dr Ngwenya.
In his January 2016 Monetary Policy Statement, Dr Mangudya said illicit financial flows and other capital flight remittances constitute a major constraint to development financing in the region.
According to the RBZ, during the period January to December 2015, a total of US$684 million was remitted outside Zimbabwe or externalised by individuals under the auspices of free funds for various dubious and unwarranted purposes that include remittance of donations to oneself, offshore investments, externalisation of export sales proceeds by corporates through individual accounts leading to pervasive tax evasion and externalisation.
“This rampant export of liquidity is not sustainable,” said Dr Mangudya, as he announced measures that included strict customer due diligence which require banks to observe strict Customer Due Diligence (CDD) and high level consciousness to ensure that all local and cross border transactions, including settlement of foreign payments by credit and debit cards, are bonafide, to the extent possible and practicable.
Source : Masasi eHarare