Mrs Banda said she was happy to "offload" the presidential perks, adding: "I can well use private airlines. I am already used to hitchhiking."
It means that the 62-year-old head of state – the second woman to hold the position in Africa – will fly to the Queen's Jubilee celebrations in London this weekend with British Airways.
Andrew Mitchell, the UK International Development Secretary who is currently visiting Malawi, delivered a £33m cash injection for Mrs Banda's government.
He said the move was a sign of the "seriousness Mrs Banda is applying to overturn bad decisions taken under the previous government".
The former vice-president in Bingu wa Mutharika's government, she stepped into the presidency in April when he suffered a heart attack. The jet had annual running costs of £220,000











