Zimbabwe's Biggest Bank Looks at Methods to 'Leverage Cryptocurrencies'

One of Zimbabwe‘s biggest financial institutions, CBZ Holdings says it is looking at ways it could “leverage cryptocurrencies and other emerging digital innovations.” According to the financial institution’s chairperson, Marc Holtzman, CBZ “is open-minded about new innovations, as these could open up new opportunities going forward.”

Innovations Opening up New Markets

Speaking in an interview with a local publication, Holtzman also acknowledges that innovations such as “cryptocurrencies, or rather blockchain more broadly, fintechs, bigtechs and techfins” are all serving “specific gaps.” Revealing his organizations stance on such innovations, the chairman said:

Our view is that these innovations have the potential to strengthen the way we do business, the way we serve our customers, as well as open up new market opportunities.

Holtzman adds that such opportunities “can be pursued through collaboration and cooperation with the same fintechs.” Consequently, the chairperson says CBZ will be embracing “an open innovation strategy in which we work with and through these fintechs in areas such as mobile money and mobile wallets.”

Potential Risks

Nevertheless, the CBZ boss does acknowledge the potential risks that will arise as a result of embracing these innovations. Still, he insists the Reserve Bank of Zimbabwe (RBZ)‘s fintech regulatory sandbox—which guides banks’ participation in these innovations and advanced technologies—will limit such risks.

“This allows for prior testing of solutions, detection of potential risks, and crafting of risks mitigants before solutions are launched to the wider market,” explained Holtzman.

With this revelation, CBZ becomes one of the first financial institutions in Zimbabwe to formally signal an intention to embrace cryptocurrencies. This announcement comes as the RBZ warms up to fintech. For instance, in its February 18, 2021, monetary policy statement, the central bank revealed that the regulatory sandbox would commence on March 1, 2021.

However, at that time the RBZ said cryptocurrencies would be excluded from a sandbox. It remains unclear how CBZ plans to leverage cryptocurrencies when the central bank statement says these are ineligible.