Finance Minister Mthuli Ncube said the government hand changed the funding mechanism for the 2019/2020 agricultural season. File Photo: IOL

HARARE – Zimbabwe's central bank has frozen bank accounts of four large companies that include fuel dealer, Sakunda as well as big car dealership, Croco Motors, pending investigations by the Financial Intelligence Unit of the Reserve Bank of Zimbabwe.

Sakunda is controlled by businessman Kuda Tagwirei, who is said to be politically connected. He also controls fuel supply in Zimbabwe through Trafigura and Sakunda. The RBZ has closed bank accounts of Sakunda and three other companies, namely Croco Motors, money market company Access Finance and Spartan Security.

In a directive to all Zimbabwean banks on Thursday, Wonder Kapofu, a director with the Financial Intelligence Unit at the Zimbabwean reserve bank, said financial institutions have to “freeze transactions in respect of all accounts” and the named companies as well as their related entities.

“The FIU is carrying out analysis on the above-named entities and their sister group companies. As we carry out further analysis, you are directed to freeze, with immediate effect, all accounts held in the names of the listed entities until further notice,” said Kapofu.

President Emerson Mnangagwa’s government has been battling to contain runaway inflation being exacerbated by the parallel market rates. This week, the government reportedly launched a crackdown on mobile money agents that were charging premiums of up to 50% for cash-outs from mobile money wallets.

The Zimbabwean central bank has now directed that banks stop processing withdrawals or other transactions from the accounts of the four companies and to notify it of “any deposit or other inflow into the accounts” as well as transfers.

Informed sources in Zimbabwe said on Friday that this could be related to parallel market dealings that have fueled the black market forex rate this week from 1:15 on Monday to about 1:20 for the ZWL versus US Dollar on Friday morning. On Friday evening, the parallel market exchange rate had fallen to around 1:17, in contrast to the official interbank exchange rate of around 1:14.

Finance Minister Mthuli Ncube said the government hand changed the funding mechanism for the 2019/2020 agricultural season. Some had blamed the spike in parallel market rates on new funds injected into the economy to fund input schemes.

Ncube said banks – including Standard Bank unit, Stanbic and Agribank as well as CBZ – have already agreed to fund the farming schemes, with the government said to be providing guarantees.