By Francis Chiwunda
So Strive Masiyiwa recently responded to the raging debate on EcoCash agents charging premiums when people cash out of their mobile wallets. I don’t agree with his reaction to this issue and here are my thoughts:
A friend said this and I sort of agree with him,
This is how monopolies fall; they become arrogant and forget to innovate. Ecocash controls a lot of things and being willfully dismissive of the profiteering from agents is disingenuous.”
I also think Strive statements are ill-informed and reckless.
1 – He says EcoCash is not a currency : although I agree with him there but he should comprehend that in Zim, EcoCash is a pseudo currency. Just to remind you, our currency is called RTGS. RTGS is a money transfer mechanism – just like EcoCash. But guess what, that’s the name of our currency. Maybe we can excuse the guy, these are just side effects of running a company through zoom video conferencing app!
2 – He keeps saying where in the world would you find banks not issuing notes etc etc. : I think that’s unfair of him to say that. See a few questions I have for him as of year 2007:
- where in the world do you transact using mobile number?
- where in the world do you find poor population transacting digitally without internet?
My point is what we have is a unique situation. If strive saw a unique opportunity back then and jumped on it and made tonnes and tonnes of money through it. He shouldn’t be asking us of unique situations today. He’s being a hypocrite! The “where in the world” card is complete BS!
3 – He says you can’t dig up a road because a thief has set on it: I don’t necessarily think the Gvt expects him to dig out ecocash. But all we ask for is close monitoring and taking responsibility where things go wrong. That’s why there are road blocks, no?
Other points to note
I think main issue with EcoCash is that our population is generally poor. And the harsh economy is not helping at all. So for poor folk the 30c transaction cost per $5 actually matters. It makes a difference! As a population, we’ve been ducking the 30c so hard but we’ve been hit by $6 instead – how painful!
Is this really about cash supply into the economy? Not entirely! I think it’s partly transaction costs ( not forgetting the 2% tax), greedy population which feeds on profiteering as well as arrogant monopolies. Oh, not forgetting the zoom app guy!
But one may say, ” oh but it’s on a willing seller willing buyer basis.” They may argue that it’s market forces. Well, drugs are also on a willing buyer willing seller basis, but tikakubata tino dealer newe (if we catch you we will deal with you)!
Conclusion
1- Strive shouldn’t be arrogant. He should stop throwing tantrums, we’re not his buddies! He should realise that his platform is being abused and take strong corrective measures.
2- Government should scrap regressive tax systems. EcoCash transaction cost should be lowered to bare minimum. Then rely on volumes, they have the market dominance anyways!
3- Zimbabwean population should stop this profiteering mindset. This platform is meant to make life easier not over complicating stuff… Now I can’t even send my grandma kwaZvimba mari yechema! It’s regressive.
After thought
As a fan of fintech and general innovation myself, I think as a society we should be ready to deal with the aftermath of innovation. Uber and AirBnB constantly deal with rape and racism issues etc.
Innovation is good but it gives birth to unique situations. It’s a pity even those who claim to be “Rockstar” entrepreneurs don’t seem to understand that fact!
Asante Sana!
34 comments
You really think that if ecocash decided to shutdown all their merchants other people will stop the practice? I know things are hard and all but let’s not forget were the problem is.
been asking this question as well.Problem with Zimbo we want short term fixes.A few months ago it was liberate the market,now its ecocash’s fault.If ecocash closes today we will still have the same problem but i guess its easier to point a finger,thats the Zimbo way of operating.
thats because u are nt using the platform
Guest author let us be clear what is the challenge to the transacting public Zimbabwe? Who is supposed to give ZW$ bank notes? Isn’t it known that once a shortage is there black-market will arise. As a country we should not deal with symptoms but the real issue. In my opinion the bottomline is Zim is in hyperinflation and this obviously results in a huge need for increasing the roll out of ZW$. Without doing this we will move from blaming Peter, to Paul to James to Jokoniya without addressing the real issue. In the US$ era why were notes being sold when people could withdraw US$1000 from the ATM? In 2004-2008 why were people spending the whole day in a bank queue when mobile banking was not there?
Guest author I thought somehow you would mention RBZ must issue notes, adequate number of notes, as the monetary authority especially to the after tax ZW$ of the Zim transacting public.
The moment they issue new notes, they are directed back to the street. We all know cash haiwaniki mubank.
I think this is one of the poorest journalism I have ever read! Why did you leave out the part where Strive asks on where these agents are getting the notes from…..(not from Ecocash, not from Stewart bank or any other bank), but from other means and then use the Ecocash platform as it is the easiest platform to transact across the country.
With the current crisis, bond notes are a commodity too, and since there are no jobs out there, some unemployed are becoming agents who have the luck of access to this commodity. Their job is collecting it and offering to needing people and make a living off it (not supporting this at all but just showing you how far this goes). This is happening on fuel, so do we blame the service stations, bread so do we blame the bakeries or supermarkets.
My conclusion is you might have beef with internet, but you should smell the coffee. A country with hyperinflation will always have situations like this. That you should know as a journalist of technology or economics. And you cant blame a servicing system if you have the economic knowledge.
PLEASE DEAR TO CORRECT ME IF I’M WRONG!
correction:
*………you might have beef with Ecocash……….
**PLEASE DARE TO…………
Okay fine guys, yes its not Ecocash’s fault, yes RBZ need to sort out the cash situation & hyperinflation. Fine bho! When you know thieves are using your road, yes you do not dig it up hantka that’s true, so what you sit back & say ah ini I made the road saka how people use it is not my problem as long as they pay toll fees??? Aiwa no, kwete! I agree that Ecocash shouldn’t be blamed for this but at the same time they have made no effort to correct this issue. Shouldn’t an Ecocash agent’s account work on CASH IN – CASH OUT basis. Surely Econet can prevent agents from cashing out more than they have cashed in, implement a KYC check on users who cash in/out with a daily limit or something of some sort to prevent one guy from depositing an un explained amount (say like a lot of thousands).
Yes we are in a tough situation at the moment, but I feel like Econet can do more to prevent the thief from parading on their road. AGAIN, I am not blaming them, but I believe they can do something about it. Iwe neni tinebasa, we are all contributing in a way to this corrupt & messed up economy and country.
Ehe, if thieves use your road together with good people what would you do? how many roads have u seen being removed because thieves are also using it. Econet has repeatedly warned against the Ecocash agencies but there is no tangible evidence to prosecute them. Remember 2007/2008 we didnt have ecocash but cash was still being sold at exorbitant rates. Even today some people are selling large sums of money though other channels like zipit and rtgs. Problem is demand and supplu issues and these agents just like allbody have seized the opportunity created by the RBZ to make an extra dollar. FYI, agents are also buying this cash from people who are not agents at very high rates. Problem is demand for cash far exceeds supply.
You speak like a child of the light. How could people try to exclude ecocash from the problem. That is insane!
The cash out on agents is purely academic. How many businesses have you bought goods from who use an agent code instead of a merchant code? Thousands!
the real issue is why is it that RBZ print notes and we dont find them in the bank instead you find new notes at the black market. Is it not that RBZ is giving the black market the money itself. come to think of it. You find an agent on the black market with new notes whereas the banks do not have notes
And where do the agents get the cash from. They are not getting the cash from econet/ecocash
Find those that supply the agents with cash! Would not be suprised that it is corrupt RBZ staff including Panonetsa himself
Next time don’t write article when you emotional, cool down first and gather your thoughts. The cash crisis is not a product of ecocash. For as long as cash is in short supply it will always be sold. we might shut down ecocash today it won’t change a thing in terms of money supply people will just find other ways of selling it because demand is high for cash.
I feel your anger is misdirected
You made a statement about Strive that I think is totally false. Unless you can provide evidence. I am sure Strive did not call himself a Rockstar entrepreneur. I stand to be corrected. But I kindly request a source.
I think the gvt is to blame……. solution is simple reduce the bank charges.by 3% that way the tax will not even be felt….
Why did govt need to rush the re introduction of the Zimdollar if the infrastructure for a cashless society was not in place? The current practice by Eco Cash agents is a product of policies that should have been analysed before implementation. Econet has 9000 agents and has already started the process of identifying culprits but this may just b a temporary measure.
Guest author. You call speaking the truth arrogance??? The issue is clearly a shortage of bank notes that is not Econet’s issue that is an RBZ problem. RBZ is purposely starving the market of bank notes so that it can cash in on the 2% tax
I normally enjoy your analysis TechZim, but on this one you are lost and you took everything personal yet Strive provided facts.
1. If only RBZ provides adequate cash no one buys cash, this is our problem which we need to address. Having said this all effort should be focused to RBZ then maybe ask EcoCash to help in the mean time to make the situation better but not blaming them for something they don’t have control over they don’t print bond notes agents don’t even get cash from EcoCash mind you this is only a channel to help us transact.
2. EcoCash agents are not the only ones taking advantage of the cash crisis, ask your self this, why would one continue to be charge exorbitant charges to withdraw cash if they can use EcoCash or Swipe cards.
(a) You will find that, even our service stations even the big ones like Engen or Total they tell you we are taking cash only behaving the same manner as the EcoCash agent you are attacking who also goes to buy fuel there.
(b) It doesn’t end there, shops/tuckshops with cheaper groceries, demand cash payments and don’t take RTGS most of them…and we are okay with this but not the agent.
(c) All these people attacking EcoCash even yourself included if i come for your services are you not putting a percentage when we come with RTGS money. Everyone is doing this which is exactly similar to what agents are doing.
(d) We have an increasing demand for foreign currency causing a significant rise on exchange rates in the street and buying forex with RTGS is very expensive compared to buying with cash. And by so doing we enhance the damage.
Having mentioned the 4 items above, are we also going to attack every single item one by one as we are doing with EcoCash knowing very well that RBZ is responsible and they are quiet over the issue. We are finding a soft spot on EcoCash since RBZ has become a big lion we can’t ask why cash is not adequate, we deposit money and we don’t get it back from our banks, where has the money gone and we now buying cash. Why can’t we ask all this?
In my conclusion, what agents are doing is wrong and EcoCash can help us manage the situation without blaming the service provider (EcoCash) because they don’t get a single coin of the extra charges. I have read some claiming they benefit from volumes, volumes have always been there because its the only reliable e-money service provider locally. Our rage should be directed to RBZ…. Mthuli and Mangudya and their government to correct this situation. They are the ones responsible, and mind you they could be benefiting from it am just thinking because they seem to be giving a closed eye and ear to this particular issue. Last year we were not buying cash, did we not have EcoCash and the their agents, so what changed its the cash crisis leading to all this suffering because of RBZ. This is nothing political this is a grey area we need them to correct for us. Its not only about providing cash or printing money…noo they can even enforce that service providers accept RTGS(mobile money included) and Bond cash be it a small business or a big Companies. Currently you will find that big shops take all modes of payments but they don’t have all the needed items which are available in small businesses that don’t take RTGS at all. The government has adequate resources to enforce this having a police force that can track this. If we can get all our daily needs at reasonable RTGS prices we won’t even need the cash this all points at RBZ and government.
I hope you will take time to go through this, thank you all.
Well said .I second u in everything u said.
Two wrongs have never made a right
Two wrongs have never made a right
I wonder if the RBZ has a mechanism to monitor the total RTGS money in circulation. Given the size of some mobile money platforms, they could very easily become their own “central bank” without anybody realizing it. There is nothing to stop them from injecting fresh “fake” electronic money into their own platforms (e.g. when paying their creditors through their own platform). The freshly injected money just circulates from one mobile account holder to another. The possibility gets even scarier with the new bureau de changes that buy USD cash in exchange for mobile money. That mobile money could very easily come from a bottomless internal suspense account. As long as the mobile platform controls a large enough market share of accounts, any new money it injects on its own platform will just move from one account to another and other players will have no way to detect the trickery. The problem only manifests through a general rise in inflation. This is exactly the same way that RTGS was abused by the central bank to steal people’s US dollars.
Yes I bet some government officials have wet dreams of catching Ecocash trying to pull such a move. That way they could immediately nationalise Ecocash. Which is why Ecocash will never be stupid enough to do such a thing.
Actually all banks have a function of creating money through lending to their customers and the reserve Bank is aware and has thresholds for that. This has been the function of banks before the advent of ecocash5
Dear Guest Author, Strive is not Jesus, the President of Zimbabwe,or the Minister of Finance or even the Reserve Bank Governor. He is just a businessman albeit a very successful one. So to accuse him of hypocrisy and arrogance for just telling the truth, is really taking things way too far. Yes you probably think/wish that he would end this waking nightmare that we are in with a simple wave of his hand but the simple fact of the matter is that he can’t, and those who might be able to are either unable or unwilling to do so.
Techzim yava ye Zanu nhai
It is always wise to Pause a little before you make a fool out of yourself , you called Strive Arrogant and a Rockstar entrepreneur I think you need to retract those statements before we can even begin to discuss the rest of the nonsense you wrote .
It is always wise to pause a little before you make a fool out of yourself , you called Strive Arrogant and
a Rockstar entrepreneur ,I Think you need to retract those statements before we even begin to discuss the rest of the nonsense you wrote .
Iyi ndiyo inonzi zero article, techzim delete this
thuuuuu techzim
It’s actually becoming our culture in Zimbabwe to find someone to blame for our failure. Eco-cash has nothing to do with what happens on the streets so you can blame them for providing a platform that is accessible nation wide and reliability. The issue here is that the government should come up with a policy framework that works for the people and let us contribute to that framework as a nation not that one day the minister says this and the next morning the reserve bank governor says the opposite.
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