THE Reserve Bank of Zimbabwe (RBZ) has ordered banks to reduce charges between 1% and 1.25% of amount withdrawn for Automated Teller Machines (ATM) and over the counter.

The order by RBZ comes after local financial institution increased withdrawal bank charges taking advantage of the cash shortages as depositors were now relying on multiple electronic transactions.

Banks were now charging withdrawal fees between US$2.50 and US$3 and Bond Notes going up to US$5 with a daily limit of about $100 and 50 bond notes.

In a statement last issued Sunday night, RBZ Governor John Mngudya said his bank will now monitor the charges to ensure access to affordable banking services and at the same time promotes the use of plastic money.

“The Reserve Bank has noted that while cash withdrawal limits have reduced significantly during the second half of 2016, there has not been a proportionate reduction in the level of bank charges.

“Against this background and as part of the on-going effort to promote financial inclusion and to ensure that the banking products and services are affordable to the banking public, the reserve bank has reviewed cash withdrawal charges downwards with effect from 12 December 2016.

“In order to align cash withdrawal charges to amount withdrawn, a proportional pricing model has been adopted to replace the current fixed charges.

“The applicable charge for cash withdrawal is a maximum of 1% and 1.25% of amount withdrawn for ATM and over-the-counter, respectively as below.”