The Reserve Bank of Malawi (RBM) has said it will formalise traders selling foreign currency outside the official exchange rate, following pronouncements made by Financial Intelligence Unit (FIU) director Atuweni Juwayeyi Agbermodji that parallel foreign exchange traders need to be regulated.
RBM spokesperson Mbane Ngwira is quoted in the local press saying bringing black market forex traders into the formal market will enable the central bank to know how much cash is coming into the country and spent.
“The fact is that majority [of forex traders] may not afford the capital required to open bureaus and we know that not all those traders that you see around shopping malls would want to do something illegal.
“Therefore, their operating guidelines would be different from the bureaus that have permanent buildings or places,” the central bank spokesperson is quoted saying.
Ngwira said some forex dealers will opt not to be registered, while those registered will be given identities and allowed to trade freely.
But pointed out that a policy to guide formalisation of regulating the black foreign exchange market has not been developed yet.
He said discussions have been taking place to check the feasibility of the process.
Some people with dollars are shunning the official financial system, starving it of foreign currency and going to black market.
Meanwhile, the Malawi kwacha is trading at around K730 to a dollar in authorised dealer banks (ADBs) compared up to K990 to the parallelmarket.
Source: Nyasa Times