MEMBERS of the public and financial sector stakeholders have called for stronger safeguards to protect depositors’ savings, saying the proposed Deposit Protection Corporation Amendment Bill should ensure bank deposits retain their value, earn interest and are reimbursed at prevailing exchange rates in the event of bank failure.
The proposals were made during recent public consultations held in Gweru on the Deposit Protection Corporation Amendment Bill as Parliament gathers public views on legislation aimed at strengthening confidence in Zimbabwe’s banking sector.
The proposed amendments seek to strengthen the country’s deposit protection framework, enhance the security of depositors’ funds and align the law with developments in the financial services sector.
Stakeholders said they expect the legislation to modernise Zimbabwe’s deposit protection system, improve operational efficiency and address emerging challenges within the banking sector.
Members of the public who attended the consultations said the new law should provide stronger protection for depositors while improving public awareness of deposit protection mechanisms.
Mr Norman Dururu said depositors expect their savings to earn interest instead of losing value through bank charges.
“Depositors expect their money to attract interest and grow instead of losing value through charges as happened in the past. Banks should not exist only to levy charges, and we hope these concerns will be addressed in the legislation,” he said.
Mr Dururu added that greater awareness of deposit protection would encourage more people to use formal banking services.
“When people know their savings are protected, they are more confident to use banks. It is encouraging that ordinary citizens are being given a chance to contribute to this law,” he said.
Another participant, Mr Shawn Mugura, said compensation paid to depositors should take exchange rate movements into account to ensure people do not lose the value of their savings.
He also proposed reducing the compensation payout period to seven days to enable depositors to access their money quickly when banks fail.
Another stakeholder called for increased public education on deposit protection.
“Many people are not fully aware of deposit protection. These consultations help educate the public while allowing us to suggest improvements,” he said.
Chairperson of the Parliamentary Portfolio Committee on Budget, Finance and Investment Promotion, Cde Lincoln Dhliwayo, said public participation remains a cornerstone of the legislative process.
“Public participation is central to law-making. We want legislation that reflects the expectations of Zimbabweans, which is why we are encouraging citizens to actively contribute. Their submissions will help shape the final Amendment Bill,” he said.
Cde Dhliwayo said the proposed legislation seeks to close long-standing legal gaps in Zimbabwe’s financial sector.
“The Bill’s primary objective is to strengthen the Deposit Protection Corporation and, by extension, protect depositors. It introduces fundamental reforms that will transform the manner in which we deal with the insolvency of banking institutions in Zimbabwe,” he said.
Cde Dhliwayo said the Bill would, for the first time, establish a specialised insolvency regime for banking institutions, recognising that bank failures pose systemic risks that cannot be adequately addressed under ordinary insolvency laws.
The nationwide consultation programme will continue in Masvingo, Mutare and Harare before the Bill is tabled in
Parliament for debate, with public submissions expected to help shape the final legislation.-herald
