The Reserve Bank of Zimbabwe has directed banks to extend the time required to process RTGS transactions in order to ease problems being faced by tobacco farmers in accessing payments at the tobacco auction floors.In a statement, the RBZ said in order to facilitate smooth processing of payments to tobacco growers, banking institutions are now required to process RTGS transactions until at least 1400 hours from the previous 1100hrs.This came as “the Reserve Bank has observed delays in the processing of tobacco payments which have been largely attributed to early cut off times for submission of RTGS applications,” according to the statement.
Problems with payments to tobacco farmers have ignited anger and frustration among many small-scale growers who are now pressuring the authorities to revert to the old system of being paid cash at auction floors.
Farmers are being short-changed by banks that do not have efficient Straight Through Processing (STP), resulting in amounts credited through the Real Time Gross System (RTGS) taking long to reflect in their accounts.
STP is a system used by financial institutions to speed up the handling of transactions which passes electronically entered information on without subsequently requiring its manual re-entry.
The Reserve Bank of Zimbabwe and Tobacco Industry Marketing Board directed that all tobacco growers to be banked, a move that had a debilitating effect on farmers as they fail to access both payment and cash on time.
TIMB spokesperson Isheunesu Moyo, said focus should be on improving the new system other than reverting to the old one.
“We are working on improving the new system whose advantages far outweigh the few challenges we have encountered. We are engaging the Reserve Bank of Zimbabwe in trying to perfect the system.
“The new system has largely been a success and our focus is on improving it as opposed to reconsidering the old system. Attempts to revert to the old system may disrupt the current operations which are smooth sailing,” said Mr Moyo.
Tobacco Association of Zimbabwe president David Mutasa, said the prevalent arrangement, which has left hordes of growers stranded at the auction floors after failing to get their vouchers and payment on time, was unacceptable and counter-productive.
Mr Mutasa insisted that delays in processing payments were derailing farmers’ plans to return to the fields immediately to finance ongoing harvesting and grading operations.
“This is unacceptable, it is the resource poor small-scale farmer who is being sacrificed.
“It is their operations that will at the end of day suffer since they are the ones responsible for the supervising of the harvesting, curing, grading and bailing back home. They do not have extra labour and leaving them stranded for five days is worrisome.
“This matter should be resolved at all costs.
“We are bitter, uncertain and unsure if there will be money tomorrow, yet that money is desperately needed to finance operations and settle debts back home,” said Mr Mutasa.
– Business Editor/Manica Post.