17 Months after being removed from the FAFT greylist, RBZ says banks still see the impact of once-exclusion from the international banking system
Getting off the list is just half the battle. Rebuilding relationships and trust is the next step.
This comes mere days before the Cayman Island celebrated its removal from the Financial Action Task Force (FATF) grey list for countries under Money Laundering and Terrorism Financing Risk review at a plenary (meeting) in Paris in October, when Bank of Zimbabwe (RBZ) deputy governor Jesimen Chipika told the media at a meeting of Financial Intelligence Units of Eastern, Southern, Central Africa and Yemen that between 2019 and 2022, Zimbabwean banks had lost over 100 international banking relationships.
(Breaking: Read all about it: Namibia greylisted by FATF, plus: see why you need great AML in property sales.)
Also see how greylisting impacts the JSE in South Africa, learn about AML compliance for microlenders and the process for AML in microfinance as well as why we need microfinance AML and all about micro-credit AML.
Counting the Economic Costs of Greylisting
Despite meeting all requirements and being removed from the greylist in October 2022, Chipika says the true “costs on the economy are hard to quantify, yet undoubtedly significant” as the country’s banking system was virtually excluded from international banking for the grey-listed period.
A grim warning to those who still take a flippant stance on greylisting.
Zimbabwean banks basically kept afloat with just two international banking relationships – Afreximbank Trade Payment Services (AfPAY) and a special platform housed under SA’s First National Bank – during that time. Yet, have since started rebuilding.
Mending Bridges
The RBZ deputy governor went on to say that the greylisting was both “a curse and a blessing” in that, despite the severe economic costs of greylisting, the country did manage to establish a much stronger AML/ CFT regime, making it one of the “best-rated countries in the region”.
This should come as a wake-up call for all those still not AML/CTF complaint, and perhaps give new impetus to the likes of South Africa, which eyes getting off the greylist by 2025.
South Africa had at the same FATF plenary gotten a pat on the back for their preliminary AML efforts but was told there’s still some way to go before it’ll be removed from the list.
Greylisting impacts your business
National-level dealings aside, AML/CTF regulations impact everyone – you can bet that when Zimbabwean banks suffered, everyone else felt it too.
So, if you’re unsure about what all this greylisting and AML compliance stuff is about, learn how AML relates to your business.
See how to save on sanction screening and how to get sanction screening in Africa.
