Economic scientist Adil Chilungo has applauded governments for coming up favorable conditions for people in the diaspora to open Foreign Currency Dominated Accounts (FCDAs).
Chilungo has said following the Reserve Bank’s announcement that it has eased some conditions to ensure that Malawians living abroad can enjoy convenient banking services in Malawi under favourable conditions.
According to a statement released by RBM, the conditions include; reduced paperwork for account opening and transactions, simplified processes for sending money locally and internationally, ability to apply for account opening online, access to online banking platforms, Issuance of debit cards and assignment of a dedicated diaspora private banker.
Speaking in an interview with radio Islam, Chilungo said this will help to ease some challenges people in the diaspora have been facing especially when sending money home.
He however, said some conditions for the operation of the FCDAS may scare away people who want large amounts of money for their local projects.
“This is a very good move, it will help people who have been failing to remit their money maybe for projects of sending their relatives money, they will now be able to remit the money because the accounts will be holding their finances in foreign currency, but this condition they are saying, the people will allowed to withdraw 50% of their bank balance, will be a setback to some especially those that have big projects, but may be they will see what they can do”, he explained.
Chilungo added that the FCDAs will also help the government in securing foreign currency, which will in turn assist in easing the economic challenges facing the country due to shortage of forex.
He therefore asked government to ensure that the taxes applicable to such accounts should be at viable rates to woe more people to come and open the bank accounts.
In his view, Chilungo said government is trying all it can, to resuscitate the country’s economy.
Also in the statement the Reserve Bank assured the public that it remains committed to fostering an environment that promotes and incentivizes diaspora remittances.
Among the services, transfers will be allowed from a Diaspora FCDA to another Diaspora FCDA, from a Diaspora FCDA to a Non-Resident FCDA, from a Diaspora FCDA to a Resident FCDA, including transfers to foreign exchange bureau FCDAs for Malawi Kwacha equivalent cash or bank transfer.
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