That’s it, that’s the story right there.
There has been talk that Ecocash suddenly suspended agent accounts. This was surprising to us when we first heard it because it doesn’t make sense that Ecocash would rock the boat with agents when this network is the strength their solid market position is built on. (If interested in how Ecocash achieved their dominant position you will want to check out our report on the Ecocash business model and its development).
It turns out the rumour is truer than we first assumed. The next thing we saw was a WhatsApp group invite link to a group of ‘supposed’ disgruntled Ecocash agents. The group is called Allied Ecocash Agents and its description says Ecocash Agents Association. At the time of writing this sentence the group has 232 participants and more seem to be joining if the rate of population growth so far is anything to go by. Very soon the maximum number of participants in a WhatsApp group (256) will be reached.
The group icon of the group is this one:
The group is very busy and it’s really difficult to keep up with the conversation there. You can tell there are angry people in there and there are also some who seem to be mocking the rest of the members.
Majority of group members are angry at Ecocash (or Econet as far as they are concerned). They are saying Ecocash has barred their agent SIM cards and more than that they are saying Ecocash still owes them their commissions and they seem to believe that the commissions will not be paid out.
A lot of talk has been around rallying up all agents to ditch Ecocash and join rival Telecash and OneMoney. Some members in the group are scoffing at that suggestion. At 10:19 a member posted that 25 of them had congregated and were marching to Ecocash offices in Borrowdale. They said they were gonna wait for 15 minutes in case others wanted to join the march. No mention of the march has happened after that so we are not sure if it happened. Not likely though, marching past the state house is a tricky one.
Ecocash’s response
We reached out to Ecocash and their response was that they from time to time temporarily bar agents that would have been reported to be violating regulations in their operations. They said they then reconnect some of the agents based on their investigations and how the agents themselves respond to the complaints made against them. Those who are found wanting are then permanently barred.
They emphasised that only a few of their agents (less than 1 000) out of their more than 30 000 have been affected. Here is a statement from Ecocash responding to our questions:
EcoCash routinely carries out system reviews and security checks on its agent network to ensure transaction process integrity, and to protect the public from irregular and outright fraudulent activities.
Where any suspicious activities are detected, EcoCash investigates and takes appropriate corrective action, including suspending or barring the offending agent.
From these standard system reviews and security checks, EcoCash shares STRs (Suspicious Transactions Reports) with the regulator (RBZ) as a compliance requirement.
EcoCash wishes to assure its customers and the transacting public that the overwhelming majority of 30.000 agents continue to trade normally throughout the country.
The issue of regulations
Some of the regulations that are obviously being violated have to do with the differential in the value of money depending on what type of money you have. The official position (according to the Reserve Bank of Zimbabwe) is that a person who is holding $100 in real US dollars is holding the same as one who has that same amount in bond notes, bond coins or in their bank account or Ecocash wallet.
However, in the real economy that you and I interact with on the streets and everywhere else $100 in greenbacks is equal to about $125 in bond notes, about $135 in bond coins and about $155 in a bank account or Ecocash wallet. Ecocash agents are thus facilitating cash ins and cash outs based on this differential. The official position is that this practice is illegal.
The law versus economics
The prevailing rates I gave above are not established by some powerful bad people who just want to break the law. The rates exist out of the basic laws of demand and supply. The official position is attempting to distort the market realities and I don’t see the law winning on this one. Markets are stubborn. Unfortunately, Ecocash can’t allow their network to be used in a way that their regulator deems illegal regardless of what the market demands. They find themselves in a catch 22.
Could the RBZ be applying pressure?
I didn’t ask Ecocash the question that they would not be able to answer if it were yes but I will just speculate and say probably the central bank is applying pressure. The RBZ is desperate to control the flow of the multicurrency basket they claim we are using in Zimbabwe. Their desperation was shown by their ban of cryptocurrency trade. They could be turning to mobile money now. They might as well suspend every bank account in Zimbabwe to be honest.
24 comments
Ecocash might not be telling the truth. They blocked almost all Harare agent lines , the reason is not a routine check , it’s actually aftee they realised a loss from a loophole in their system . Some agents were getting commission without working and thereby not adding value to ecocash . The sad part is some lines were barred whilst they had people’s float .
Then let them make money outside Ecocash as they are making money
Is it illegal for a Zim business to price its goods and services in Rands, Indian Rupees, Pulas, EURos or any other currency in the multi currency basket? Assuming it’s not illegal, how would the central bank control the conversion to USD/bond? When the law says 1USD=1bond, does it also fix all the possible cross currency rates?
Thats an impossible argument to win against the government. By ‘law’, bond notes are not a currency, but a proxy for one.
All ecocash agents asking for a % When cashing out will get blocked as it’s illegal , all know this and continue to use their platform for these illegal transactions , so people are reporting and the agents are getting blocked .
Do you really believe that’s the reason why agents accounts were barred ? Ecocash made a loss from some agents who were rotating cash without bringing physical value . They really don’t care about premiums , otherwise banks would also bar all those bank accounts
Loss? Hahahaha
We all know that the disparity is the cause of this… But it’s life move onto the next big thing… The truth is our economy is ranked and all there RTGS balances are coming home to roost… Prices are most certainly raising and everyone is just trying to clean their account… Brace yourselves winter in coming… Let’s hope the economy is of knees before we vote so we can get change
Ecocash agents are just been very greedy , they casually tell you 20% on top to cash out ! So yes block them for this illegal action !#NO TO % for cashout ! BLOCK THE GREEDY ECOCASH AGENTS !
No pity from me. These agents have crooked us for far too long.
indeed!
Unscrupulous agents should just be banned for good. Period! Imagine being denied to cash out simply because the money is reserved for friends, relations or osiphatheleni. Nxa
So wakamboenda kubank ukawana mari here unofa kt agent ape munhu wese waaona mari. Kare agents wld cash out kueconet vouya vopa vanhu mari ryt nw econet yacho kungonyrpedzera kurwadziwa but it is cashing in from those agents esp wen kusina mari so…
Econet needs to restore legacy on their ecocash agents !
Yaaah ban them with their percentages nonsense. Ecocash doesn’t need agents anymore and WE THE PEOPLE don’t need them anymore either. When was the last time any of us did a cash in or cash out? They can form associations and toyitoyi all they want but they know full well that they only used those lines for illegal activity.
Problem is banks are not giving cash so where do you expect agents to get cash from… Of course they going to favour their relatives etc… Would you not do the same… Supply demand.. Besides what you going to with cash just use your ecocash
Why does anybody still use EcoCash? MyCash is a much better, more efficient and less expensive system.
I’m happy with this initiative they have taken.we have lost so much money to these crooks.they should be sued for taking advantage of consumers.selling money is not right..they should be barred for a very long time!!
Can you follow up on this issue I understand some agent lines were reopened but hvnt received their commision as yet.
I’m surprised with how some people here lack common sense,iv come to understand that few understand the hypothesis of economics,you cant say agents have been stealin from u,why on earth would u go and ask for their money then if they are thieves?why not go get all you want from a local bank?so by being given $30 by a bank do u also render them thieves when you wanted $20 000 cash? Before blaminf any1 get to understand whats happening in Zim,what led to that and possible solutions before judging the term ”crooks” yet we walk to them and join lines to do those cashouts,we voluntarily do so lets not satisfy our frustrations by blaming agents before blaming ourselves for being responsible both socially,politically etc,An appreciable injection of money in the circular flow of income will automatically liquidate money changers,as of now Pamberi neEcocash,,pamberi nevakutipa mari zvakaoma,Life goes on the futurq is oura to effect change or not.
No matter what anyone has done or is doing, the fact that you guys are profiteering at our expense still stands. The moral highground you’re trying to build is just the pot calling the kettle black.
its funny how every Zimbabweans are blaming eco cash agents.here is the true scenario. customers are now doing cash in t a percentage o eco cash agents and if the agent does not agree the customers goes else where. and the same customer is the one saying eco cash agents are riping them off hence street money changers are in the streets changing money at high rates but no one is saying a word about them…………………
Still Still u seem to be a bit confused,if u currently are in possession of a Usd $100 not yet you want to make a transfer payment what on earth are u goin to do,ndimi maCustomer munoenda straight muStreet mobvunza how much is being bought for a Usd note and get yo transfer iri even $150,,now zvii zvaukuda kutaura dont u know the situation in Zim?we want open minded people on planet earth
If money was available it would be given without rates. USD100, Bond100 and ecocash100 all have different values in practical use. But only a fool would blame the next person who is only trying to make a living by adjusting to the market changes to stay in business. You are busy blaming each other while the real crooks are the ones you put in offices to run things for you. You know the real problem so just stay put until elections come and vote wisely.