“Cell phone companies are welcome to offer MMS but they should do it via banks. For example Ecocash is using various banking platforms and that is a noble strategy, but there is concern that banks have no guarantee that Econet will not steal their clients,” an anonymous Zimbabwean reportedly told Biztech Africa.
Econet and Telecel, two of the country’s mobile service providers, already offer active MMS services. However, the new banking reforms might bring an end to its independent operations.
The general feeling is that these services are taking a big bite out of the conventional banks’ profit.
The Bankers Association of Zimbabwe (BAZ) is requiring governmental regulations to even out the ground between the banks and mobile operations before the end of the month.
Although cheaper fees were suggested for conventional banks as a bridging solution between banking and mobile banking, the BAZ has complained about loss of revenue, which could amount to US$72 million.
This followed Tendai Biti, the Zimbabwean Financial Minister, saying banks should not charge for deposits of less than Z$800 (US$2.21) and only require a four percent interest fee for Z$1,000 (US$ 2.76) held over 30 days. Debit cards should be available without cost to the consumer. He encouraged the use of plastic money in his speech as part of the 2013 National Budget Statement.
“Zimswitch (a platform that integrates the banking platforms and enable withdrawals from across different banking institutions) will collapse if the majority of the banking public are allowed to operate through ATMs and POS free of charge,” said BAZ, according to Biztech Africa.
The general opinion among banks is in favour of the suggested law, although they share the BAZ’s concern about the financial profitability.
As only 38 percent of Zimbabwe’s population currently makes use of financial institutions on a formal level and 40 percent makes no use of any formal or informal products and services, the nation is still not fully reached on financial level. These figures were gathered in a survey conducted in May 2012 by FinScope.
Further figures reveal only 24 percent of the country’s residents has access to bank accounts and 27 percent of Zimbabwean adults save money at home rather than at a bank.
In comparison, mobile banking has a greater chance of reaching the estimated 14 million unbanked masses with 10.5 million of the population being cell phone savvy, according to combined network subscribers numbers.
Econet, NetOne and Telecel provide approximately 70 percent of Zimbabweans with mobile connection.