BY DR MASIMBA MAVAZA|The Minister Of finance announced his plans to introduce a new currency with several motives in mind and thus began Zimbabwe’s struggle with monetisation.

As the clock struck 12 midnight on November 1 2019 Zimbabwe came to a standstill and Minister Mthuli Ncube announced one of the most ground breaking changes in the Zimbabwean economy. Hours after the country was wiped out of old currency, the new currency was already flooding the black market with the culprits with such audacity that they pause for photos and circulate them in the social media. This unparalleled stubbornness and shameless corruption so clearly displayed. The behaviour of these money sellers is so insulting and makes the efforts by the president of Zimbabwe a big joke. The non punishment to these corrupt but well connected idiots places Zimbabwe in a very precarious position. The effects of such actions by these economic saboteurs effects can still be felt in the economy today and years to come. The youth who came across as no nonsense pilgrims have deafened our ears with their silence. The non partisan ZACC quickly defused into thin air with their tails in between their legs like humiliated bull dogs. Who could be that culprit that his actions are swept under the carpet despite the fact that they are criminals who are worse than genocide pigs.

The silence by the authorities has been one of the most criticised moves by the ZACC and everyone from former RBZ Governor To the man in the street has condemned this move and its effects on the Zimbabwean economy.
From slowing down the economic growth in various sectors to giving people nightmares of the long queues and the inability to spend liquid cash freely, the hullabaloo created by demonetization is remembered by one and all on its first day in circulation. Monetisation began as a way to curb the black money from our economy was later addressed as a means of making Zimbabwe cashless and giving digital Banking a boost.

Monetisation was initiated with a wide array of motives like stripping the Zimbabwe economy of its black money, push people to pay taxes for the unaccounted pile of cash, and make Zimbabwe a cashless economy.
Piggybanks have been transformed to savings accounts as people turn towards increasing bank balances instead of stashing emergency cash in different corners of the house. People finally are expected to begin to trust the digital payment systems; because that is the only option they were left with and if the money is available the need to hold it is nill.

Monetisation is meant to prove that economy can strive and adapt to any changes and make people financially aware about the different spending options. The government’s efforts to revamp the currency system provided people with a boost to use the cash that was lying around and invest it in a more productive way. The more native and conservative people also will open up towards the era of plastic cash and make several Zimbabweans tech friendly.

One of the most important points that pushed people to support monetisation is its associating with bringing an end to the black money problem in Our economy. However, almost 99% of the money will be deposited back to RBZ. The statistics will reveal that either the hoarders found a way to legitimize their black money or did not hold them in the form of cash. the money in cash according to several finance experts and when this point was highlighted time and again, other important effects of monetisation are publicized by the government, like the role of demonetization on curbing terrorism.

Pushing Zimbabwe towards becoming a cashless economy was another reason that monetisation was publicized for. People turned towards digital transactions for everything from buying groceries from a road side vendor to paying utility bills during the time of monetisation. However, as the flow of cash into the economy began to increase, the use of these apps and digital wallets will see a steep slope once again.

Pushing Zimbabweans to deposit and account the cash lying in their house also meant a rise in the tax payments for the country. According to government expectation the income tax payers will record an increase in the post monetisation era.

Demonetization had a lasting effect on Zimbabwe’s MSMEs (Medium, Small and Micro Enterprises). Various medium and small enterprises turned towards digitalization, however, the micro industries will be affected by the worst of its wrath. The micro industry owners are not a part of the black economy and they are clearly unprepared for the effects of demonetization. Many micro industry workers may return back to villages and the growth rate of these companies may be as low as 1%. The MSME sector has been recovering from the drastic changes and its impact on the revenue, but demonetization forced the MSME sector to be friendlier and more accommodating towards the digital arenas and made them more accommodating towards change.

While these are some of the effects of monetisation on the national and economic front,monetisation gave individuals several lessons that have changed the way we look at managing finances.Monetisation will make sure that we monetize our earnings to get the best returns possible whether it is by turning to monthly investment schemes to save better or by turning our safe cash pile into an easy withdrawal FD (fixed deposit). The government’s revenue will see an increase because of demonetization and its initial effects are already prevalent in the income tax filings post note ban. Demonetization has played a crucial role in bringing digitalization and financial planning into the forefront for many. India has withstood the immediate chaotic impacts of demonetization and it is evident that the returns of the hardships will begin to show in the coming months.
So the unveiling of new generation currency marked major milestones in Zimbabwe’s banking sector.

According to the man on the ground the new notes, which is the largest currency bill, are widely being used for illicit financial transactions and forgery in domestic market and the neighbouring countries. The last two motives are ostensibly geared towards curtailing further expansion of the underground or parallel economy.

But what exactly is demonetisation and what are its intended benefits?Monetisation is the availing of coins, notes or even precious metals for use as legal tender through change in national currency. It involves replacement of old with new currency. From perspectives of monetary policy, monetisation has several possible benefits.

For instance, when a currency is availed, people tend to deposit cash. This will kiss good bye to money shortages.

If the government is serious about corruption those involved in distributing the cash to black markets should be publicly punished.

Vazet2000@yahoo,co,uk