Kwacha Only: Zambia Tightens Grip on Local Transactions

The Bank of Zambia (BoZ) has ordered that all local payments in Zambia must now be made in Kwacha and Ngwee, marking a significant shift in the country’s monetary policy.

According to BoZ assistant director communications Besnat Mwanza, the central bank’s new currency directives came into effect yesterday, aiming to ensure the country’s money is used properly and to prevent the use of foreign currency for everyday transactions.

The move is expected to have a far-reaching impact on businesses and individuals alike, as foreign currencies like the US Dollar or South African Rand can no longer be used for domestic transactions, unless specifically exempted by the Bank.

“The Bank of Zambia has issued the Currency Directives, 2025 that take effect on December 26, 2025. This has been done in exercise of the powers contained in Sections 18 and 73 of the Bank of Zambia Act, 2022,” Mwanza stated, emphasizing the legal basis for the new rules.

Under the new regulations, any domestic transaction, whether private or public, must be settled in Kwacha, meaning individuals and businesses must adapt to using the local currency for local purchases and services.

This means if you’re buying something from a local shop, paying for services, or conducting business inside Zambia, you must use the Kwacha, simplifying transactions but also limiting options for those accustomed to using foreign currencies.

The rules do not apply to international transactions, so payments for imports or exports remain unaffected, allowing businesses engaged in global trade to continue operating smoothly.

BoZ said the move is intended to stabilise the Kwacha, promote its use in everyday transactions, and ensure that Zambia’s economy remains on a strong footing, a goal that many hope will be achieved through this bold step.