It was only a matter of time, wasn’t it? With the launch of national money transfer services left, right and center, EcoCash was the latest brand name not in the mix. Which was, until last night, a bit surprising…
Zimbabwe’s remittances game is one of the most sought after as numbers of incoming remittances have increased over the past two years, even as early pandemic projections put them down in sub-Saharan Africa.
In 2021, the figure for Zimbabwe was $1.430 billion, an increase of 43% on the sum recorded in 2020 and the year of the pandemic saw remittances reach one billion, which surpassed the record high of $939 million recorded in 2015.
With numbers steadily rising, companies have tried to position themselves where they can to make the most of the cash flow. We’ve seen a lot of activity from banks like CBZ launching a dedicated money transfer branch, remittance startups like Senditoo and Shumba Money offering limited-run no-transaction promotions for money sent to Zimbabwe .
Nationally, companies have also tried to find out where they stand in this area and we have seen a number of national remittance services like City Hopper from BancABC, Instant Cash from NBS Banks, Steward Bank Remit, Mojo Mula and many others. Even mobile money operator OneMoney has launched its own service (OneRemit) to try to interfere in local foreign exchange trading. And now the country’s largest mobile money service, EcoCash, has thrown its hat in the ring.
EcoCash Domestic Remittances
Last night, EcoCash Zimbabwe announced that it would enter the domestic remittance game through its EcoCash FCA wallet. The mobile money operator said customers will be able to do so through a new short code, *153#.
This new access platform is there to give some separation from the conventional *151# EcoCash which is only for local currency. And for those who prefer to use the EcoCash app, the service is there but you can switch between local currency and USD.
Limits, cash-ins/withdrawals and fees fees fees
The service is open to everyone even if you are not a registered EcoCash customer. However, there are some differences in the amount you will be able to send. If you are a registered EcoCash customer, you will be able to send $500 per week with a limit of $2,000 per month, those who are not registered can only send half that amount. This is not unusual as these are similar terms to BancABC’s City Hopper.
As with any other money transfer service, you will be able to withdraw and withdraw money from Econet stores nationwide or you can withdraw and send money through your FCA wallet. To make a transfer in person, you will of course need to bring with you your valid ID/driver’s license/passport and the money you wish to transfer.
The next question is “How much is all this going to cost?” and the answer to this question is:
|BANDS||REGISTERED CUSTOMERS||NON-REGISTERED CUSTOMERS|
|Lower value (S)||Upper value (S)||Money sending fees||Withdrawal fee||Price for sending money|
From the pricing table, EcoCash’s domestic remittance service seems to be the cheapest in Zimbabwe when you go up to the higher numbers (to just send money, it’s complicated but I’ll explain). For example, if you want to send 100 USD (as a registered customer) you will be charged 1.56% which is cheaper compared to the competition because for the same amount you will be charged:
|Limit||Costs||Sending cost of 100 USD|
|BenchABC City Hopper||$250 for non-BancABC customers
USD 500 for BancABC customers
|Mandate of the union delegate||–||2%||$2.00|
However, if you choose to cash out, you will be charged $2.61 for the $100 you received. So if, for example, you owe someone $100, you’ll need to factor in the cost of sending the money of $1.56 as well as the $2.61 if they intend to send the money. cash in. The fee, according to the launch event, takes into account the 2% tax the government has introduced on all transactions.
Dear, are there any benefits?
These fees are a bit high compared to what is offered in the market, however, there are certain advantages when it comes to a wallet-based money transfer service. The first one I can think of is that you can deposit the money into your EcoCash FCA in bulk (which is a default account if you are registered with EcoCash). All you will then have to do is send your FCA EcoCash money to the intended recipient or multiple people.
This could help reduce travel costs and waiting times at Econet stores if you were to do it transaction by transaction as you would with any other national money transfer service that does not have a wallet.
The second advantage is that it sort of solves the change problem that we all have encountered when trading in USD. Zimbabwean companies love to set the price in dollars and cents, but can’t give you exact change. This usually requires many to receive the remainder in local currency at the rate the seller estimates that day. And it’s rare that someone selling something offers you a great price. They will most often like to profit from the transaction or the sale will not take place if the buyer decides to withdraw.
Also, if the money was for a specific service that required USD, paying it digitally from a wallet might be a better option, especially on days when that service doesn’t have a branch open.
The third advantage, which relates more to EcoCash, is that customers remain within the ecosystem of the Econet group. Yesterday we reported on the Econet Smart USD bundles, which is one of many services/merchants that mobile money operator customers can use their EcoCash FCA wallet to pay for.
These are just a few things I could think of could make those costs worth it. However, I would really like to know what you think of EcoCash’s national money transfer service.
At the launch event last night, EcoCash also said they are running a dollar-for-dollar promotion that will see EcoCash match anything you send through their national money transfer system up to $10.
The mobile money operator has set aside $10,000 for this, so it looks like if you put in $10, EcoCash will credit you the equivalent amount.