By Mubanga Mubanga
Bank of Zambia (BoZ) Governor Dr Denny Kalyalya says the bank will not allow anyone to scam it when they go to exchange old notes with new ones.
Speaking during the Monetary Policy Committee (MPC) press briefing at BoZ headquarters in Lusaka yesterday, Kalyalya said BoZ was on high alert to look out for those who wanted to scam them during the currency exchange for the new currency with the old ones.
“Money laundering issues … absolutely this is something we are not taking lightly. We are working closely with our colleagues, law enforcement agencies to make sure that we bring to book whoever is going to scam us. So including to take advantage of this exchange,” Kalyalya said. “So, word is out that they will be very, very alert. Even the banks, the financial institutions that will be doing this exchange, they will be very, very alert.”
Kalyalya said BoZ chose to introduce the K200 and K500 notes because the current highest note of K100 function store of value had eroded.
“Because if inflation continues to rise, and rise, rise then the value of those notes gets eroded. So currently, if you look at where we are with the K100 note what is it in Dollar terms? less than five Dollars. But when we issued it, it was quite a viable amount,” Kalyalya said.
He said K100 note was supposed to be a note to be kept and not to start trading with.
“Because often, if you went with that note, you will not find change. But we have gotten into a point where it becomes the go to note, which means that its store of value function is eroded. So we need to do something about that,” he said.
Kalyalya also said the bank also looked at the number of hours some people were spending at the bank when doing cash transactions.
He stressed that the introduction of K200 and K500 was going to reduce the number of hours people spent at the bank.
And Kalyalya said BoZ had increased the Monetary Policy Rate by 50 basis points to 14.5 percent from 14 percent, saying this was done to steer inflation back to the 6-8 percent target band.
“In the fourth quarter of 2024, average inflation rose to 16.3 percent from 15.5 percent in the third quarter. The implementation of higher emergency electricity tariffs in November 2024, triggered by the drought in the 2023/2024 rainy season, has had a substantial impact, particularly on non-food inflation, which rose to 14.1 percent from 12.2 percent in October,” said Kalyalya. “Furthermore, the reduced supply of vegetables and fish, as well as the depreciation of the exchange rate, have contributed to higher inflation.”
You can subscribe to read all our past and latest ePapers, plus all premium content at only K22 weekly and K65 monthly on this link 
https://dailyrevelationzambia.com/membership-account/membership-levels/
