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Econet says it won’t back down on its demands to banks

   
Econet Chief Executive, Douglas Mboweni
Econet Chief Executive, Douglas Mboweni

Econet Wireless has pronounced a firm refusal to back down on it’s demand on banks to pay a tariff of 30 cents to gain access to its transaction messaging system. This is according to a report in The Herald that quotes Econet Chief Executive Douglas Mboweni reaffirming this stance.

According to the article, Mboweni insists that the disputed tariff conformed to regional rates for system access despite the outcry from several banks that the tariff is prohibitive. He highlighted how banks have to choose between either the USSD platform or integration with EcoCash. He emphasised the point that banks will not be granted access to the USSD platform unless they paid the prescribed tariff.

Although this appears to be unfair play from the network, Mboweni argues that as they set up the infrastructure they cannot be told by someone seeking their service how much to charge for it. Banks have expressed concerns that the rate makes mobile banking expensive and denies the consumer the convenience of mobile banking.

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This dispute between local banks and Econet has been playing out for a while now, with banks having gone to the extent of reaching out to State legislation for intervention in dealing with Econet’s “monopolistic tendencies”.

Econet however does not seem to be bothered, considering that ten banks have already integrated to its EcoCash system. This shows a compliance with a player that has already established an impressive dominance of the local mobile money transfer space. At a tour of its operations by legislators last week, Mboweni mentioned how EcoCash had processed $4 billion since 2011.

At the moment it doesn’t seem as if any action, legislative or otherwise, will be taken to pin Econet into submission regarding this issue. Besides going back to the drawing board and coming up with a competitive product inspired by prevailing trends in technology, the only other option is to play by Econet’s rules.


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