RBZ’s Monetary Policy Committee Voices for SMEs

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Reserve Bank of Zimbabwe’s (RBZ) Monetary Policy Committee (MPC) has given a voice in support of the Micro, Small and Medium Enterprises (MSMEs) on the resolutions made on 26 March 2021 according to the Bank government John Mangudya.

Small and Medium Enterprises (SMEs) have been complaining about getting no support to recover from the lockdowns imposed by the government.

The small businesses have also been complaining about not getting foreign currency at the Foreign Currency Action System.

But Mangudya said, “The MPC encouraged bureaux de change to support Micro, Small and Medium size Enterprises (MSMES) which require foreign currency for their various productive requirements at levels below the minimum qualifying threshold of the SME foreign exchange auction system.”

“The MPC also resolved to put in place a term lending facility to assist funding needs of SMEs benchmarked on the experiences of other central banks.”

The MPC also made the following resolutions during the latest meeting:

a. Maintaining the current conservative monetary targeting framework, anchored on 22.5% reserve money quarterly targets.

b. Keeping the Bank policy rate and the Medium-term Bank Accomodation (MBA) facility rate at 40% and 30% respectively

c. Increasing the amount of the MBA Facility by an additional ZW$2.5 billion to cater for the winter wheat planting programme.

d. Putting a cap on the interest rate at which banks can on-lend the proceeds from the MBA Facility at 10% above the borrowing rate to ensure recovery of the productive sector.

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