Zimbabwean central bank lifts suspension on bank lending

The  Reserve Bank of Zimbabwe (RBZ) on Tuesday, lifted the suspension on lending.

The suspension lifting was announced by President Emmerson Mnangagwa at the beginning of May but said companies being investigated for alleged financial misdemeanors would still not be allowed to borrow.

Mnangagwa on May 7, announced a raft of measures that he said, would bring back confidence in the use of the local currency, among them a suspension on lending to all entities, including government, corporate and individuals.

The move, however, triggered disruptions within the economy, with some companies stopping advance payments to contractors while others stopped buying commodities citing lack of cash.

RBZ governor John Mangudya said in a statement that the ban had now been lifted with immediate effect.

“Further to the circular, the Reserve Bank of Zimbabwe issued to banks on  May 9, 2022, the bank wishes to advise the public that the temporary suspension of lending services by banks has been lifted with immediate effect,’’ said Mangudya.

“The lifting of the suspension do not apply to those entities that are under investigation by the Financial Intelligence Unit (FIU) for abusing loan facilities to the detriment of the economy.

“The FIU has accordingly advised all banks of the affected entities,’’ Mangudya said.

RBZ recently said that it reserved the right to publish names of significant borrowers across the banking sector in the public interest, in the wake of manipulation of the exchange rate by some borrowers of large amounts to the detriment of consumers.