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#Mobile Money

Exclusive: Econet finally opening up full USSD level mobile money to the banks

   

USSD

Sources in the industry have exclusively told us that Econet has finally given in to the pressure of the banks, regulatory authorities to open up full USSD functionality for the ZimSwitch mobile money transfer services. Specifically, this means in the coming weeks and months, banks, through the ZimSwitch Shared Services platform, will be able to provide a full mobile money transfer to Econet subscribers. We wrote to Econet to get confirmation of this but there was no response to our emails. However our sources at the company confirmed the development.

For EcoCash subscribers this means they can now use their Econet SIM cards to do ZimSwitch enabled mobile money transfers to mobile phones. So far, only Telecel and NetOne subscribers could do mobile money transfers to other mobile phones using the ZIPIT to mobile functionality that ZimSwitch connected banks use. Econet subscribers who were subscribed to a bank’s ZimSwitch Mobile service could so far only do non-mobile money transfer transactions like buying airtime and transferring money to bank accounts

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This is therefore a significant change in policy at Econet as until now the company insisted spiritedly that banks could only provide mobile money transfer services to Econet subscribers at the EcoCash level. In short, peer to peer money transfers on the Econet network were exclusive to Econet.

Why open up now?
Well, the most obvious reason we could think of is that the company may feel they have made significant progress integrating banks at the EcoCash level. They have signed agreements with at least 6 banks.  Econet may feel therefore its integration to the banks is a richer product than what the banks currently offer via the ZimSwitch’s Shared Services platform.

The market may also be more aware of the EcoCash brand than they are of the separate competing mobile money brands by the banks. Consider too that the banks are a struggling industry, and clearly unable to invest in brand and platform awareness initiatives that Econet can spend on. The banks are a crippled competitor right now. What huge threat could they be really?

Another suggestion for why now is that there’s some pressure from the reality of Steward bank needing interoperability with the other banks through the ZimSwitch platform. Econet, our sources in the banking industry suggest, have found they can’t close access on their end while expecting the banks to open full interoperability on their end.

An official in the financial services industry, who preferred not to be named had this to say about Econet reasons for finally opening up: “My feeling is because they know it will cause too much trouble in the long run, and now that EcoCash has had 3 years to penetrate, they do not see it as being a real risk anymore… compared to a couple of years ago”.

Outstanding issues access cost and network neutrality

Even with the new access, there’s still the issue of how much it costs to transact. According to the information we have, Econet currently charges 5 cents a session for the limited USSD functionality now, but apparently plans to charge more a session for money transfers. This is akin to an internet provider charging more per megabyte for traffic to some websites (competitor websites) than they would for all other traffic.


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