This seems to be what is happening in the Ecocash saga. The government crackdown on Zimbabwe’s largest mobile money platform is being peddled as a blow to financial inclusion.
What is financial inclusion in the first place?
According to the World Bank, “financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit and insurance – delivered in a responsible and sustainable way.
“Being able to have access to a transaction account is a first step toward broader financial inclusion since a transaction account allows people to store money, and send and receive payments….”
There is no dispute that the advent of mobile money in Zimbabwe brought about financial inclusion. But Ecocash was in business not charity. It was there to make money. Its aim was not to provide an affordable service but to provide a service to as many people as possible.
To them it did not matter if a person had 20 mobile money accounts. This was business. And there was nothing wrong with that if people were doing honest business.
So what really happened? Why are some people upset by the crackdown?
According to Ecocash’s parent company, Smartech, the authorities issued seven directives which impacted on its operations. They were:
- 21st April 2020 – Reduction in daily, monthly and transactional limits,
- 4th May 2020 – Suspension of Agents with transactions above ZW$100 000 and requirement for their re-registration,
- 4th June 2020 – Suspension of Agent to Agent transactions,
- 26th June 2020 – Directive to integrate to Zimswitch, in line with SI 80, by 30 September 2020,
- 27th June 2020 – Suspension of some Ecocash User Categories and Functions,
- 25th August 2020 – Revision of mobile money limits and permissible transactions,
- 25th August 2020 – Ban of use of multiple wallets by individuals effective 8 September 2020.
The daily limit is now $5 000. Is this too little? For whom?
If it is true that the average Zimbabwean lives on less than US$1.90 a day or $190 a day at a generous black market rate, is $5 000 a day too little for the average Zimbabwean?
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