THE value of transactions processed through the National Payments System (NPS) declined by six percent, to close the week ending January 26 2018 at $1, 766 billion according to the latest Reserve Bank of Zimbabwe’s (RBZ) Weekly Economic Highlights. RBZ said the decline was mainly driven by a 46 percent decrease in the value of Real Time Gross Settlement (RTGS) transactions, to $1,1 billion from 1,284 billion during the week ending January 19. This is despite bank’s RTGS systems being clogged as most Zimbabweans are relying on this mode of payment for virtually all transactions. The system congestion has affected most banks. This has resulted in payments being delayed and financial institutions fail to cope with volumes as technical hiccups are bound to happen including connectivity problems. This then defeat the essence of ‘real time’ as transactions are even taking up to four working days to be processed. In value terms, RTGS transactions accounted for 65,8 percent of total NPS transactions. The proportions of other payment streams were mobile, 22,02 percent, POS, 11,82 percent ATM, 0,29 percent and cheque, 0,07 percent. BancABC chief economist James Wade said cash shortages had led to rapid growth in payment systems and penetration to the unbanked. “Further reduction in transaction costs is critical for greater financial inclusion and confidence rebuilding in the banking sector which is not dominated by RTGSs,” he said. While mobile transactions have been embraced as an alternative payment option, concerns continue to be raised over the high electronic transaction charges. Due to a cash crisis in Zimbabwe, most service providers in both the public and private sector have adopted mobile money as a means for processing payments placing the channel as the most common alternative for the country’s unbanked population and the nation’s significant informal sector. An acute shortage of bank notes in Zimbabwe has forced Zimbabweans to resort to electronic means of payment. According to the Postal and Telecommunication Regulatory Authority of Zimbabwe’s mobile money now accounts for about 80 percent of total transactions in Zimbabwe. The volume of transactions processed through the NPS stood at 26 906 840, during the week under review. This reflected a three percent increase from the 26 057 297 transactions recorded in the week to January 19. The distribution of NPS transaction volumes was as follows, mobile, 77,79 percent POS, 21,35 percent RTGS, 0,45 percent; ATMs, 0,39 percent and cheque, 0,02 percent. Meanwhile, during the week under review, commercial bank weighted lending rates for individual clients stood at 9,33 percent up from 9,31 percent recorded in the previous week. Weighted lending rates for corporate clients, however, remained unchanged at 6,99 percent-Fingaz