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Mounting pressure on Zim telcos as economy stagnates

Mounting pressure on Zim telcos as economy stagnates.

Zimbabwe's deflated economy is impacting on the country's telecommunications industry and has forced operators to leverage promotions to reduce service tariffs.

The local economy is battling severe cash shortages and resulted in a daily limit on withdrawals of approximately US$200.

The government is drumming up usage of plastic money and mobile money to help ease the cash crunch. It will also introduce bond notes (local currency backed by a $200 million Afreximbank facility) in October as a way of incentivising exporters and dealing with the cash shortages.

While the internet has emerged as a 'cash cow' for mobile companies amid declining voice revenues, executives are reviewing their promotions to reduce mobile and mobile internet charges - but are equally adamant that the approach must generate profit.

Douglas Mboweni, chief executive officer of Econet Wireless, said "Any promotion should give value to customers and also make business sense."

Econet Wireless has since revamped its data bundle offerings, expanding the periods of validity. There are now options for weekly and monthly options for its 7X promotion that gives subscribers seven times more worth of value of voice minutes and data used.

Telecel Zimbabwe is also running promotions that give 100% bonus value on airtime top ups. On Friday it announced that it was reducing tariffs for its mobile money platform, Telecash.

"Our decision to lower Telecash tariffs is in response to the need to encourage and make more affordable the use of electronic and plastic money in line with government's efforts to ease the current cash crisis," said Violet Masunda, Telecel's acting head of mobile financial services.

Under the new tariff regime, Telecash has brought down the Telecash Gold debit card charges from a maximum of US$2.95 down to only US$0.45, while transactions of less than US$2 are now free.

Bill payments have also been reduced from a maximum of US$3.70 down to US$1.50 with bill payments of under US$5 being free of charge. Telecash competes in the Zimbabwean mobile money sector against Econet's EcoCash as well as the OneWallet platform run by NetOne


Data prices fall in Africa but it's not enough says A4AI Published on 01 October 2019

Organisation says despite lower broadband costs and mobile data prices, African governments still have big task ahead.

Data dominates as Zimbabwe's voice fades Published on 07 October 2019

Recent statistics from the industry regulator shows substantial differences in revenue contribution between data and voice services.