Government’s surrogate currency known as bond notes has negatively affected vendors at the country’s biggest informal market of Mbare in Harare, Parliament heard yesterday.

Vendors at the bustling market told the Parliamentary Portfolio Committee on Small to Medium Enterprises (SMEs) that the bond notes have a tendency to be devalued by their suppliers when they seek to replenish their stocks.

“The introduction of bond notes has really affected us. When we go to buy stocks to places like South Africa using the Rand we have to exchange the bond notes on the black market.
“Some people reject the bond notes and in the instances where they are accepted they devalue the currency which leaves a huge dent on our pockets,” Memory Taonenguwo, secretary for Mbare Musika women’s League said.

The SMEs also said that they were facing challenges with plastic money. “We do not want to use mobile money transfer as a means of buying and selling because sometimes the charges are too high,” Agnes Watungwa said.

“We are proposing charges of less than 3%. Currently we are charged between 10 to 15%, which is unprofitable when dealing with perishable goods. We cannot afford to borrow from banks right now because their rates are also beyond our reach. If we borrow, to a greater extent we are bound to fail to pay them back and the banks will end up suing us. Our businesses are unpredictable, we sell perishable goods hence they rot and profit is not guaranteed.”

The committee, which was on a tour of the market collecting views on the Movable Property Bill, also heard that vendors and people in the informal sector had challenges accessing cheap finance to fund their businesses.

“If the Movable Property Bill is to be passed we would be very glad. Some of us we have got more than 50 cattle that the banks can actually use as collateral but cannot borrow money from banks because we do not have properties such as houses and payslips,” Abel Dzotizei said.
The Movable Property Bill seeks to allow the use of assets such as cattle as collateral in financial transactions. Newsday