Zimbabwean banks plan to fight $100m Paynet lawsuit

Zimbabwean banks intend to fight a $100m lawsuit brought by Cambria Africa's units in the country following a dispute over payments, court filings show.

The Bankers Association of Zimbabwe, which represents the nation’s 21 lenders, “would defend the action,” the organisation’s legal representatives said in the court documents, filed last week. The association had been served with a summons on July 24 giving them 10 days to respond to claims from Cambria’s Paynet and Payserv units in Zimbabwe.

The battle between London-based Cambria and the association reached boiling point in June when Paynet, one of the country’s largest providers of bulk payments such as salaries, suspended services to banks, citing unpaid bills.

It forced the lenders to switch to smaller providers or resort to manually managing payments, hindering the flow of money in the cash-starved $31 billion economy, already grappling with rampant inflation and mass unemployment.

Cambria on Tuesday said banks had closed their Paynet gateway, preventing compliant lenders from transacting with them and hindering the orderly flow of payments. The company is betting a partnership with Ecocash, the mobile-money unit of Econet Wireless will help it recover some of the lost revenue from the dispute with the banks.

“If not successful, Cambria will need to significantly downsize its operations in Zimbabwe, as it continues to pursue legal recourse through the courts of Zimbabwe,” the company said, adding it may also approach courts in neighbouring South Africa, or the UK.

ZAR/USD
16.77
(-0.09)
ZAR/GBP
21.15
(-0.12)
ZAR/EUR
18.95
(-0.11)
ZAR/AUD
11.66
(-0.17)
ZAR/JPY
0.16
(-0.09)
Gold
1798.22
(+0.06)
Silver
18.69
(+0.13)
Platinum
824.50
(+0.30)
Brent Crude
43.14
(+2.10)
Palladium
1961.36
(+0.61)
All Share
55417.89
(-0.66)
Top 40
51154.08
(-0.74)
Financial 15
10472.31
(+1.28)
Industrial 25
76134.69
(-1.67)
Resource 10
52483.78
(-0.20)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1937 votes
I am taking a hit, but should be able to recover in the next year
23% - 2541 votes
My finances have been devastated
35% - 3791 votes
It's still too early to know what the full effect will be
25% - 2718 votes
Vote