BOZ decision to scrap off unwarranted bank charges excites EAZ President

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Economics Association of Zambia (EAZ) president Lubinda Haabazoka is delighted with the Bank of Zambia’s decision to abolish the unwarranted fees that commercial banks charge depositors.

And Dr Haabazoka has brushed aside claims by the Bankers Association of Zambia that the charges were necessary for maintenance of infrastructure such as ATMs and that scrapping them off would lead to job loses.

The central bank announced on Monday that the Bank of Zambia Prohibition Against Unwarranted Bank Charges and Fees Directives of 2018 had been promulgated into law effective Tuesday, September 4.

BOZ had notified financial institutions last week of its intention to abolish a number of bank fees and charges levied on depositors, calling them unwarranted.

A circular dated September 3, 2018, and signed by BoZ deputy governor for operations Bwalya Ng’andu reads: “Please be advised that Bank of Zambia Prohibition Against Unwarranted Charges and Fees Directives of 2018 have been promulgated into law by Government Gazette Number 6693 of August 31, 2018. Pursuant to Directive Number 9, the Bank of Zambia hereby designates September 4, 2018, as the effective date on which the said Directives shall come into force.”

The central bank’s decision has been recived with excitement by EAZ  president Lubinda Haabazoka, who has campaigned against bank charges campaigner for years.

“Colleagues, the chapter has finally been closed. Effect today, September 4, 2018, the unwarranted charges and fees by banks are illegal! The BoZ has directed all banks to stop such charges and fees!!! The Directive in the Government Gazette number 6693! Enjoy free withdrawals, balance enquiries, free kwacha accounts, among other things! God bless the BoZ,” Dr Haabazoka wrote on his official Facebook account yesterday.

Earlier, Dr Haabazoka had laughed off the Bankers Association of Zambia’s explanation that the charges were necessary for maintenance of infrastructure, such as ATMs.

“The excuses banks are using to resist the unwarranted charges are laughable!!! This is not a battle we should lose. We want to enhance financial inclusion, reduce lending rates by encouraging people to deposit with banks on longer terms, but what we get from Bankers Association is worrying. Job losses? I thought banks should lend money for a profit and not charge people over nothing. If banks insist, then government should allow companies to pay salaries by cash!!!! We shall see which money banks will hold!!!! Banks apart from demanding that an employer guarantees repayment of our loans still insist that we insure our loans!!!! With all these repayment assurances, they still demand high lending rates and deny people loans so that they can just charge us for keeping our money!!! Banks are barely renting our money. It is us they should pay and not the other way round! Say no to unwarranted charges!”

The list of exploitative bank charges prohibited by the the central bank includes: ATM pin reset, account opening for local currency, cash deposits on ATM, a charge on a basic savings account without cheque book, balance and other account enquiries, reactivating a bank account, among others.

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Start: 2019-07-01 End: 2019-07-31