Minister of Finance, Economic Planning and Development Goodall Gondwe says plans are at an advanced stage to introduce a K5 000 banknote, but fell short of disclosing when it will be issued into circulation.
In an interview last evening, the minister said the K5 000 banknote will be introduced “soon” and is designed to reduce the cost of printing money.
He said: “It’s [the introduction of the K5 000 note] solely to reduce printing costs which have become so expensive as the country transacts using a lot of cash.”
The minister dismissed assertions that introduction of such a high value banknote would in the near future be inflationary, saying: “The development is coming at a time when the country is already experiencing low inflation rate.”
Malawi’s headline inflation rate hit the single digit mark in August when it reached 9.3 percent and by September it settled at 8.4 percent, according to the National Statistical Office (NSO) data.
In an interview with Malawi News Agency (Mana), Gondwe said it costs $8 million (about K5.8 billion) to order new banknotes.
He also said some countries in the Southern African Development Community (Sadc) region, notably Tanzania, have 10 000 shilling banknote.
The K5 000 note will follow the K2 000 note introduced on December 19 2016 by the central bank as the highest denomination bank note in accordance with Section 17 of the Reserve Bank of Malawi (RBM) Act of 2010.
Former RBM governor Charles Chuka said at the time that rising inflation was forcing people to carry a lot of cash when undertaking transactions, hence the K2 000 banknote.
RBM spokesperson Mbane Ngwira said dates for the introduction of the new note will be communicated later. n