EcoCash international money transfers coming soon, starting with South Africa

   

Yesterday, Econet made an announcement via a release to assure the market that issues (these, issues) have been resolved with “virtually all banks” and everything working according to plan, all banks that want to be connected to EcoCash, would be integrated by end of March 2013. According to release Econet is apparently responding to fears by some financial institutions that they’ll lose customer to EcoCash integrated banks.Econet Zimbabwe has finally announced that it will be launching a remittance service under EcoCash. The suggestions that they were working on a service to rival international remittance services using their mobile money infrastructure started as early as last year.

The service will start with South Africa, a country that hosts millions of Zimbabweans legal and illegal economic migrants. Research figures released by FNB when they launched their SA-ZIm remittance service earlier this year, indicated that as much as ZAR 6.7 million is remitted back home every year by Zimbabweans in South Africa. After the South African launch, Econet says they will launch the service in Zambia and Botswana later this year, and then in future the UK and US.

In all these markets Econet will compete more directly with Mukuru.com service that many legal and illegal migrants in the Zim diaspora have relied on for instant transfers of small amounts back home. There’s of course the established bus systems transfers that to compete with as well. The bus drivers, who were the only available option especially for illegal immigrants, would charge anything between 10 and 20% to transfer money across borders manually. They are already reeling under the Mukuru competition and EcoCash will no doubt add to the assault.

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Apart from Mukuru and the bus drivers, there’s ofcourse Western Union, MoneyGram and bank telegraphic transfers but really, it’s the ridiculous cost and inconvenience of these that necessitated bus drivers and Mukuru.

The announcement today says in South Africa the service will only be available to subscribers of the “CALL HOME” SIM cards. There’s no information yet on how much the transfers will cost but we’re guessing Econet will position it to compete favourably against Mukuru and the bus drivers, otherwise cost is likely so much an issue if they price it well above few will use it.

Like other international remittances in Zimbabwe in Zimbabwe, the transfers will likely be one way: only into Zim without an option to send money outside the country. Outbound will have to go the bad old telegraphic transfer route.

There’s also no mention of which agents Econet will partner in South Africa. Mukuru uses PEP storesM-PESA, which is generally accepted as what EcoCash was modelled on, provides international remittances through a partnership with Western Union.

You can read the full Econet release here.


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