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RBZ sets withdrawal limit for tobacco farmers

Tobacco farmers will be permitted to withdraw cash of up to $1 000 from their first sale and $500 for following sales in light of ongoing shortages of cash that the country is facing, the central bank said yesterday.

Zimbabwe, which is using the United States dollar as its chief currency, is battling cash shortages that have been triggered by mainly high imports and externalisation. To mitigate the cash shortages, the Government introduced bond notes, a medium of exchange equivalent in value to the greenback, which are backed by a $200 million Afrexim Bank facility. The 2017 tobacco selling season opens today.

In a joint statement with the Tobacco Industry and Marketing Board (TIMB) and farmers associations, the Reserve Bank of Zimbabwe (RBZ) said growers would be prioritised.

“The Reserve Bank of Zimbabwe, TIMB and Tobacco Farmers Associations wish to advise that under the current 2017 tobacco selling, individual small-scale farmers will be allowed to withdraw cash of up to $1 000 from their first tobacco sale and a maximum of up to $500 for subsequent sales,” it said.

Large-scale commercial farmers, the RBZ said, would be required to justify their cash requirements through applications to their bankers.

“The commercial farmers will be required to give a day’s notice for such cash withdrawals.

“The Reserve Bank of Zimbabwe and all the banking institutions are geared to assist farmers to access their cash during the current marketing season. Farmers are encouraged to use electronic money (plastic money) for their transactions,” the central bank said.

Tobacco merchants have mobilised about $600 million to purchase the crop this season.

Meanwhile the RBZ said the 5 percent export incentive for the current season would be credited to farmers’ bank accounts on a monthly basis.

In order to encourage tobacco farmers to increase production, as well as promote financial inclusion, the RBZ introduced a five percent export incentive to growers payable through normal banking channels. Zimbabwe anticipates an output of 205 million kg of tobacco during the 2016/17 selling season.

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