Mnangagwa says Ecocash had created $8.4 billion phantom money

Zimbabwe President Emmerson Mnangagwa yesterday told the Zimbabwe African National Union-Patriotic Front provincial coordinating committee in Gweru that the government cracked down on Ecocash, the country’s largest mobile money platform, after it had discovered that Ecocash had created $8.4 billion in phantom money.

Ecocash is owned by Zimbabwe’s richest man Strive Masiyiwa, and is the largest mobile money platform in the country.

Mnangagwa said a committee that was set up to investigate what was happening discovered that some people with no source of income at all were trading as much as $86 million a day from their Ecocash accounts.

“We studied this thing. We were able to go the server. Server yacho. Ndokwatandowana zvose. Huori hwese. Haah, ndokutora zitsvimbo, ndokurova,” he said.

Mnangagwa said that the committee discovered that there was more unofficial money outside the official system which was driving inflation in the country “tika dealer nayo”.

Eddie Cross, a member of the Monetary Policy Committee, said just over a week ago that the central bank decided to crack down on Ecocash after it discovered that in February alone, Ecocash turned three times the amount that all the country’s 13 commercial bank combined had turned over.

He said that Ecocash’s 96 bulk payers in February alone transferred $3.8 billion to Ecocash trust accounts.

The money was used to buy foreign currency on the black market through some 75 000 agents, pushing the black market rate to as high as $200 to the United States dollar.

According to figure provided by the regulatory agency, Ecocash accounted for 96 % of the mobile market which transacted nearly $20 billion in the first quarter of this year alone.