Golden Sibanda Senior Business Reporter
The Deposit Protection Corporation says it will compensate account holders of failed banks in liquidation, as part of Government’s demonetisation programme, until the end of this month.
In a reminder of the initiative, DPC said that the proceeds of the demonetisation exercise are being paid out to qualifying account holders of AfrAsia, Interfin and Allied banks.
“DPC shall pay the equivalent US$ amount for each account balance as at December 31, 2008 converted by the UN exchange rate of US$1 to Z$35 Quadrillion,” the deposit insurer said.
DPC is paying account holders of Zimbabwe dollar denominated bank accounts for the three banks as at December 31, 2008.
Only holders of active deposit/savings accounts as at December 31, 2008 are eligible for payment while holders of investment accounts are not eligible for payment.
An amount of five United States dollars for every bank account that was held and which had a balance of zero up to one hundred and seventy five quadrillion Zimbabwe dollars.
Any Zimbabwe dollar balances above one hundred and seventy five quadrillion Zimbabwe dollars will be paid at one United States dollar to thirty five quadrillion Zimbabwe dollars.
Government, through the Reserve Bank of Zimbabwe, has undertaken to compensate account holders of Zimbabwe dollar balances in an effort to bring finality to the issue of the local unit scrapped in 2009 after being rendered worthless by the ravages of inflation over the decade to 2008.
A number of banks and financial institutions collapsed in the 2003-2004 banking sector crisis, due to liquidity constraints with a similar crisis gripping the banking sector after 2009.
Post-dollarisation a total of eight banks namely Genesis, Capital, Interfin, AfrAsia, Tetrad, Royal, Trust and Allied, went under prejudicing depositors of their hard-earned cash and destroying trust in banks, key financial intermediaries.