Zimbabwe’s Deputy Prime Minister Arthur Mutambara reportedly is urging banks in the country to “develop competing products” that will allow them to match or surpass Ecocash, the mobile banking service of South Africa-based telecommunications group Econet, instead of engaging in what he described as “fighting against technology”. Zimbabwe’s government reportedly has declined to promulgate a law that would penalize Econet for Ecocash engaging in what the local banking industry has described as encroaching on banking practices. Ecocash began partnering with retail banks in Zimbabwe in 2011, enabling its clients to access their bank accounts via mobile phones in order to make payments, withdrawals and deposits. In response, Deputy Prime Minister Mutambara claimed that penalizing Econet could impede efforts to encourage financial inclusion among low-income people in the country.
As of February 2013, 88 percent of the people in Zimbabwe own a mobile phone while 20 percent have access to the traditional banking system. As of December 2012, Ecocash has been used to transfer approximately USD 300 million in Zimbabwe since it was launched in September 2011. Econet serves 6.4 million of the country’s total 11.2 million mobile subscribers.
By Brian LeBlanc, Research Associate
About Econet
Based in South Africa, Econet Wireless is a telecommunications group with investments in Africa, Europe, South America and East Asia. It offers mobile and fixed telephone services, internet service and satellite services. The group’s subsidiaries include Econet Wireless International, Econet Wireless Africa, Econet Wireless Global and Liquid Telecom. Ecocash is Econet’s money transfer service that allows Econet customers to transfer money between mobile phones. Econet operates in Mauritius, South Africa, the United Kingdom, Ivory Coast and China.
Sources and Additional Resources
The Herald Online article, “DPM Mutambara Urges Banks to be Innovative to Surpass Ecocash,” http://www.herald.co.zw/index.php?option=com_content&view=article&id=68111
MicroCapital story, December 21, 2012, “Government Hopes Zimbabwe Microfinance Wholesale Facility Can Lower Microfinance Institution Interest Rates that Reportedly hit 40% Montly,” https://www.microcapital.org/microcapital-brief-government-hopes-zimbabwe-microfinance-wholesale-facility-can-lower-microfinance-institution-interest-rates-that-reportedly-hit-40-monthly/
MicroCapital story, December 20, 2012, “CBZ Bank, Econet Wireless Partner to Offer Mobile Banking in Zimbabwe,” https://www.microcapital.org/microcapital-brief-cbz-bank-econet-wireless-partner-to-offer-mobile-banking-in-zimbabwe/
MicroCapital story, October 24, 2011, “Econet Wireless Zimbabwe, Telecel Zimbabwe Each Launch Mobile Banking Services,” https://www.microcapital.org/microcapital-brief-econet-wireless-zimbabwe-telecel-zimbabwe-each-launch-mobile-banking-services/
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