Bank of Zambia Governor Dr. Denny Kalyalya has issued a stern warning to individuals who prefer keeping money under their mattresses, stating that such cash will cease to be legal tender after the withdrawal period designated for the introduction of new notes. He emphasized that those holding large sums of cash outside the banking system should take note of the transition and act accordingly to avoid financial losses.
Dr. Kalyalya further revealed that law enforcement agencies will closely monitor individuals depositing significant amounts of money during the withdrawal period. Authorities will question the sources of such funds and seek explanations as to why the money was kept outside formal financial institutions. This measure aims to curb illicit financial activities and ensure transparency in the banking system.
Meanwhile, the governor announced that the Monetary Policy Committee (MPC) has decided to increase the Monetary Policy Rate (MPR) by 50 basis points to 14.5 percent during its February meeting. The adjustment aims to address economic challenges and maintain stability in the financial sector.
Dr. Kalyalya also noted that inflation is projected to remain outside the target band of 6-8 percent over the next eight quarters. This indicates ongoing concerns about rising prices and economic stability, prompting the need for proactive monetary policy measures.
The Bank of Zambia continues to encourage citizens to embrace formal banking channels and comply with financial regulations as the country transitions to the new currency notes. The warning against hoarding cash underscores the importance of integrating personal finances into the banking system to promote economic stability and security.