Mobile phone firms move into money

Telecel’s move into mobile banking has been seen as evidence of the rise of mobile telephony in Zimbabwe, and could mean money services reach more people.

Telecel recently unveiled its mobile money transfer system, Telecash, to rival Econet’s EcoCash. The company said it would start off with 1,600 agents countrywide and anticipated registering 1.6m subscribers – 60 per cent of its 2.5m subscribers – in the first six months.

Econet has a million subscribers on its EcoSave banking platform, and 3.5m are using its mobile money transfer system.

Economist Godfrey Kanyenze told The Zimbabwean that the rise in the popularity of these services was down to the issue of financial inclusion.

“Not all areas are covered by banking services, but mobile platforms can transcend geographical boundaries. They are easily accessible and can go anywhere,” he said.

Reports show there are now around 13.5m mobile subscribers in the country.

With a subscription market share of 63 per cent, Econet remained on top and registered 408,127 new subscribers in its network between July and

September 2013. Telecel, with a market share of 18.8 per cent, is ranked second and had 95,652 new subscribers. NetOne has 18,1 per cent of the market.

University of Zimbabwe academic Greg Lennington told The Zimbabwean that providing services like these could help revive a savings culture among Zimbabweans.

“Experience has shown that the majority of Zimbabweans no longer trust banks,” Lennington said.

Econet said that more than $200m is being moved every month through EcoCash.

“The amounts involved are astronomical and the system is already a success and is set to become bigger than the conventional banking system,” Kanyenze said.

The transaction costs on mobile platforms are small compared to banks, which also offer low interest rates, make high charges and are hampered by a perception of lack of security.

Telecel mobile financial services director Nkosinathi Ncube said his company’s product allowed mobile users to send money to anyone with a mobile phone across all networks. It also allowed mobile users to make transactions through ZimSwitch.

For people in remote areas, an alternative to banks could be very welcome.

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