Zambia to Ban Foreign Currencies for Local Transactions and Phase Out Cheques
In a recent address to the National Assembly, Dr. Situmbeko Musokotwane, Minister of Finance and National Planning, outlined proposed measures by the Bank of Zambia aimed at reforming the financial landscape.
These include the potential prohibition of foreign currencies in local transactions and the gradual phasing out of cheques.
Dr. Musokotwane emphasized that these proposals are currently in the consultation phase, with stakeholders being invited to provide feedback through the Public Private Dialogue Forum.
The Minister highlighted several key objectives of the draft regulations, including strengthening monetary policy effectiveness and enhancing financial sector stability.
“The use of foreign currencies for local transactions can undermine financial stability, especially during currency fluctuations,” stated Dr. Musokotwane. “Our goal is to align transactions more closely with the Zambian Kwacha, bolstering our monetary policy framework.”
Regarding cheques, the Minister clarified that while discussions are ongoing, no official decision has been made.
“The decline in cheque usage over the past decade necessitates a review of their role in our payment system,” he remarked. “Any potential phase-out will be implemented gradually over at least eighteen months, ensuring a smooth transition.”
