TelOne announces $80 million outstanding bill cancellation

TelOne, the country’s sole fixed line operator, announced today that they have cancelled debts of residential customers amounting $80 million. Each customer will have a total of $257.82 credited to their account. The debt cancellation follows similar moves by other parastatals – ZESA (national power company) and come city councils – in recent months.

In the announcement today, TelOne said that the cancellation was in view of the “cash-flow challenges currently facing our clients across the market”. The cancellation will be effected on the October 2013 statements.

Most TelOne customers accumulated huge debts, some amounting to thousands of dollars, in the period of transition from the Zimbabwe dollar to the multi-currency regime in 2009. The hyperinflationary changes in money value before dollarisation meant billed amounts would be worth much less by the time the customers settled. So essentially, TelOne customer were paying close to nothing for the service. The change to the US dollar was swift and many customers caught unaware resulting in huge US dollars bills.The result was that most closed their accounts leaving the debt unpaid, and numerous debt collection threats issued by the operator have largely been ignored.

The issue of unsettled accounts has affected the uptake of other TelOne services like ADSL, as initially customers were not allowed to subscribe for new services until they settled all outstanding debts. Eventually, TelOne did away with this requirement but its not clear just how much uptake it resulted in.