Regulatory Alerts2015-01-01
Interest on the Trust Account for Electronic Money Issuers
The Bank of Zambia issued PSB Circular No 01/2015 to require electronic money issuers to earn interest on their trust accounts at commercial banks, effective 1 February 2015. Issuers must negotiate interest rates with their banking partners, submit the terms for regulatory review, and maintain separate records of earned interest for monthly reporting. The accumulated interest is excluded from required reserve funds and must be utilized primarily for customer education on mobile money or other activities approved by the central bank.
[Logo: Bank of Zambia]
Bank Of Zambia
OFFICE OF THE SENIOR DIRECTOR – SUPERVISORY POLICY
2nd February 2015
PSB Circular No 01/2015
To: All Electronic Money Issuers Non-Bank Led Model All Commercial Banks
INTEREST ON THE ‘TRUST ACCOUNT’ FOR ELECTRONIC MONEY ISSUERS
The Bank of Zambia wishes to inform all electronic money issuers that effective 01 February 2015 the balances in the ‘trust account’ at the commercial banks shall begin to earn interest. In order to facilitate this, all electronic money issuers will be required to carry out the following:
- Negotiate the interest rate with the commercial banks that maintain the ‘trust accounts’. The negotiated terms shall be submitted to the Bank of Zambia for review;
- Keep record of the interest earned on the ‘trust account’ in a separate account and submit as part of the monthly returns the cumulative interest amount earned on these accounts;
- The interest earned on the ‘trust account’ shall be used to conduct customer education on the use of mobile money and/or any other activities may be approved by the Bank of Zambia;
The interest earned on the trust account will not form part of the funds that are required to be maintained by each electronic money issuer for the electronic money issued. The Bank of Zambia or any person appointed by the Bank may examine your record relating to the use of the interest.
All electronic money issuers are required to proceed as guided.
For further guidance you may contact the Director – Banking, Currency and Payment Systems.
[Signature]
Chisha Mwanakatwe
CC. Governor Deputy Governor – Administration Acting Director – Banking Currency & Payment Systems