October 30, 2020

Keeping You posted

With Trusted Zimbabwe News as well as Local and Regional Perspectives.

Zimbabwe’s Pensioners Back In Bank Queues

By Tariro Guwira

Mutare- It is a windy day with small clouds visibly seen scudding in the blue sky in Mutare, Zimbabwe’s fourth largest city and Josephine Duri (83) is seated on the pavement of a local bank waiting for the authorities to instruct the elderly to enter the banking hall.

This grandmother of twelve, who is from Sahumani village in Mutasa district, about 56 kilometers from Mutare, had slept at the banking hall the previous day.

“Today is the second day I have been trying to get my pension payout,” Duri, who was looking tired and weak, told this publication.

“I slept in the alley yesterday in a bid to get the first spot today.”

Duri’s worries were that she might not withdraw her pension that day as banks were closing at 1500 hrs yet it was lunch already.

“l am not sure if l will be able to get my money,” she said.

Duri travels to Mutare every month end to collect her $600 (USD6.50) pension which is not even enough to cover her day to day expenses.

“My two way transport tickets cost about $840 (USD9) which is far below the money I want to collect from the bank,” she said.

Josphat Marume (86), another pensioner who walks with the aid of crutches, from Chikanga, a high density suburb in Mutare, said he had collected his pension but had come to queue so that he could check a balance in his bank account.

“For the past three days I have been coming to town to queue for my money,” Marume who was not wearing a mask said.

He said the money is not enough to buy his medicines for Blood Pressure whose prices are pegged in USD.

Zimbabwe is experiencing its worst economic crisis in decades with hyperinflation, high unemployment rate and shortages of basic commodities including electricity and fuel.

Inflation rate has surpassed an annual of 800 percent as of July this year, according to the Zimbabwe National Statistics Agency.

Its local currency, the Zimbabwean dollar’s value against its benchmark the United States dollar has been eroded fueling incessant price hikes on a weekly basis.

In a desperate move to stabilise markets in June this year, the Central Bank dumped its unpopular interbank market rate with weekly foreign exchange auctions to determine the $ exchange rate with those in the industry and commerce.

However, while the official rate is 83:1 against the greenback at black market the $ is trading at 100:1 against the greenback.

John Mangudya, Reserve Bank of Zimbabwe (RBZ) governor in his mid-term monetary policy in August scrapped the payment of salaries and wages through bulk payments and mobile money agents as part of measures to curb illicit transactions.

Pensioners who were receiving their pensions straight from the National Social Security Authority (NSSA) via mobile money will have to go to the bank to collect in person after submitting bank details to NSSA.

Pensioners like Duri who were accessing their pensions via mobile money while in the  comfort of their homes will now have to visit banks and join the long winding queues.

With travel restrictions imposed by the President Emmerson Mnangagwa administration to curb the spread of the global pandemic Coronavirus, some pensioners are stuck in their homes with no payments from NSSA.

“Pension funds are suspending pension payments for those pensioners who were being paid through mobile money platforms until they submit bank account details,” said Luckmore Chivandire, a Harare based economist.

“Many of them were receiving their pensions through mobile money wallets and now they are forced to open bank accounts. This definitely affects pensioners who live in remote areas where banks are non-existent.”

Chivandire said the timing of the RBZ directive is wrong considering the current restrictive travel bans.

“This directive has no place in the 21st century because it militates against the tenets of financial inclusion,” he said adding that pensioners’ pensions had been eroded forcing many to to wallow in abject poverty.

Researcher and Economist at Labour and Economic Development Research Institute of Zimbabwe, Prosper Chitambara at a media sensitization meeting late last year said in the context of Zimbabwe the poverty datum line (PDL) is the proxy for the living wage.

“Those households whose monthly expenditure per capita is equal to the food poverty line are classified as poor, while those monthly expenditure per capita is equal to or above the (PDL) are classified as non poor. Zimbabwe has experienced relatively low levels of wages since the adoption of the multi-currency regime,” he said.

Chitambara said Poverty Income Consumptions and Expenditure 2011 to 2012 survey shows that as a result of the low incomes, Zimbabweans are selling financial assets more than they are buying them, suggesting that they are wasting to fund current consumption expenditures.

Insurance, Pension and Provident Funds commissioner, Grace Muradzikwa speaking at a virtual launch of the Insurance and Pensioners Commission and NSSA, Insurance and Pensions journalists mentorship 2020 programme said due to low uptake of insurance products-a recent Baseline Survey revealed that only 34 percent of the population in Zimbabwe have insurance of some sort, 76 percent of which are in respect of funeral assurance policies.

“Many potential pensioners have lost confidence mainly owing to loss of value as a result of hyper-inflationary. The period 2009 and 2019 resulted in loss of value for the insurance and pensions industry following the conversion from the Zim dollar to the USD and vice versa respectively,” she said.

Arthur Manase, NSSA acting general manager, speaking at the same meeting said they were working tirelessly to make sure that no one falls into abject poverty.

“We are keen in offering safety and security to avoid poverty at all levels and making sure that everyone is covered ,”said Manase.

For Duri she said she will keep on coming to collect her monthly pension that is not enough to cover even her transport hoping a sustainable solution is implemented by NSSA.

“The money is not enough for my grandchildren and I. Prices are going up on a daily basis and it is becoming hard to make ends meet as we survive on hand to mouth,”she said.