Mobile Money Driving Zimbabwe Towards a Digital Economy
Mobile Money penetration is effectively driving the country towards a digital economy in which the current cash constraints have spurred mobile money bill and merchant payments to be used as an effective alternative mode of making payments.
Figures posted across the banking sector have shown an immense contribution by mobile and digital platforms in terms of the volume of transactions which has been identified as a key initiative in the face of the prevailing foreign currency and cash shortages. The contribution of digital payment systems has become a key revenue driver for most business.
Mobile money plays a key role in extending financial services to people with limited access to traditional financial institutions, particularly the rural population as well as women and youths.
More importantly in Zimbabwe, Banks and financial services providers have earmarked digital innovation as a key factor in the face of the current liquidity crisis and banking services are increasingly incorporated with mobile services.
Complementary, figures posted by the Reserve Bank of Zimbabwe show that the volume of transactions through National Payment Systems (NPS) is skewed towards mobile transactions encompassing over 83 per cent transactions, whilst POS, RTGS, ATM and Cheque transactions share the remaining figure.
According to a study conducted by GSMA, mobile money continues to expand rapidly across Sub-Saharan Africa. In 2017, the total value and number of mobile money transactions grew by 14.4 per cent and 17.9 per cent to reach $19.9 billion and 1.2 billion, respectively.
GSMA reported that there were 135 live mobile money services across the region at the end of 2017, with 122 million active 10 accounts.
In Zimbabwe, mobile money services are largely dominated by Ecocash which is owned by Econet Wireless Zimbabwe then Netone’s OneWallet and Telecel’s Telecash. These platforms have become the most reliable way of making payments by average Zimbabwean.
Mobile money has become a vital tool in digitizing transactions in the public and private sectors. Today, a growing number of mobile money providers across emerging markets are collaborating with governments to digitize person to-government (P2G) payment streams in a bid to improve fund collection, transparency, trace-ability and accountability.
Recently, the government has urged schools to accept mobile money payments to lessen the burden on parents of only relying on bank transfers and cash payments.
According to the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ), the total number of active mobile money subscriptions as at 31 March 2018 was 5,500,625 up from 4,706,778 recorded in the last quarter of 2017.
This represents a 6.35% increase in active mobile money subscribers in the first quarter of 2018 when compared to the last quarter of 2017 figures.