Western Union already has a similar web to mobile money transfer arrangement with network operators in and outside Africa such as Kenya’s Safaricom, Tigo from Paraguay, Vodacom in Tanzania and MTN in Uganda. This will just be an extension of the same setup to the Zimbabwean market which enjoys a healthy inflow of diasporan funds.
In April this year Econet Wireless officials mentioned how their network had reached an agreement with Western Union for the arrangement involving remittances to EcoCash mobile wallets. What was still being finalised at the time was the integration of the necessary systems.
This development will make Western Union the second money remittances firm to partner with EcoCash after a similar arrangement was made with WorldRemit and launched in June this year.
Econet is eyeing partnerships with more money transfer agencies; institutions which it considers as partners rather than competition. On a similar note, it’s competitor in all things, Telecel, has also jumped into the game with a remittances-to-mobile-wallet service sired with Mukuru as recently as last month.
Although nothing seems to have been taken away from the EcoCash/WorldRemit partnership, this marriage with Western Union (or any other transfer agency that EcoCash will court) seems to be driven by the need for a wider footprint, something that WorldRemit with its presence in 35 countries, isn’t able to provide as extensively as Western Union that is in over 200 countries.
With products like EcoCash Diaspora, debit card services, EcoCash Payroll and EcoCash Loans, Econet is aggressively pushing the earning potential of its mobile money service by exploiting the extensive reach of the EcoCash agent network (which now stands at over 15 000 agents) and its strong subscriber base (which now exceeds 3.7 million users).
In all of this the overall plan for Econet is to diversify from falling voice and SMS revenue streams. Business through voice hasn’t been as brisk for mobile networks as it used to be unfortunately.
Broadband services haven’t yet fully reached their potential as revenue centres because of huge investments required, and a feeble smartphone penetration rate, so mobile money is set to be offer telecoms companies some redemption. Remittance services are just one of the many ways mobile money is likely to be used for this in the short to medium term.