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Zimbabwe’s Biggest Bank Looks at Methods to ‘Leverage Cryptocurrencies’

Updated: Aug 31, 2024
Published: May 26, 2021
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Zimbabwe’s biggest bank, CBZ Holdings, says it is looking at how it could leverage on cryptocurrencies and other emerging digital innovations.

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Goals can be realized by working together with fintech companies

The Bank believes that cryptocurrencies and blockchain technology in general can strengthen the way it does business, the way they serve their customers, and open a door to new market opportunities. The goals can be realized by working with fintech companies, helping the bank with an innovation strategy in areas such as mobile money and mobile wallets.

The bank also notes that there are of course risks that come with such innovations. Fortunately the regulator - the Reserve Bank of Zimbabwe - has already published a Fintech Regulatory Sandbox to guide banks' participation in these innovations and advanced technologies.

Meanwhile, the group reported strong figures for the year to December 31, 2020. Total revenue jumped 628 percent to $14 billion, from $1.92 billion in the same period a year earlier. The reason for this jump was the bank's digitization program, Chief Executive Officer Blessing Mudavanhu said in an interview.

“That digitalization drive is something that is just before Covid-19. We capitalized on it because business continued, and now as we go forward, we try to polish it and expand it to other business such as agriculture.”

Blockchain technology could help Zimbabwe overcome its economic crisis

Just over a decade ago, Zimbabwe was hit by hyperinflation so severe - peaking at 89.7 sextillion percent in November 2008. Because of the hyperinflation the country abandoned its currency and instead adopted a basket of international currencies led by the US dollar.

The use of blockchain technology and cryptocurrencies could solve many problems for Zimbabweans. Blockchain technology makes transactions virtually tamper-proof. And because it eliminates third-party intermediation, transaction costs are low. This could save up to $90 million a year in remittance fees. Also, the ability to store money in a digital currency such as Bitcoin or a stablecoin, could allow citizens to be more confident in their financial system.

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