Earlier today we attended the official launch of a partnership in agent banking between Steward Bank, the financial institution owned by mobile operator Econet Wireless, and Zimpost, the country’s national postal services company.
As had been highlighted previously, this launch was meant to introduce all of Zimpost’s branches to the Steward Bank Agent Banking service, which allows a host of Steward Bank’s primary services to be dispensed through EcoCash agents.
This becomes the latest execution of Steward Bank’s branchless growth strategy, which was was first introduced a year ago and has been used as a cost-effective way to establish a presence in residential communities and peri-urban centres. The model has since been adopted by other local banks.
Zimpost has always been a provider of EcoCash services which made them a suitable partner for Steward Bank. However, this wasn’t the only consideration. According to Steward Bank CEO, Dr. Lance Mambondiani, Zimpost also provides a strong and visible network and presence in remote areas of Zimbabwe.
It has also cultivated a strong loyalty among the peri-urban and rural demographic which has always viewed the Post Office as a strong representation of trustworthy services.
Econet’s EcoCash, which has a direct relationship with the products and services handled by Steward bank has a key role in this relationship.
Beyond its involvement as a technical partner that handles the mobile banking requirements of Steward Bank clients, it is also going to be a gateway to mobile money products to Zimpost clients; something which could prove to be an opportunity for an expanded market for EcoCash, while creating a larger presence in banking halls that a particular demographic has always been comfortable with.
So where does this leave POSB?
As a postal services entity with a direct relationship through the POSB, the retail bank spin-off from a once agglomerated national post and telecoms entity, any relationship that results in the onboarding of a bank easily resembles a conflict of interest. If Zimpost wants to extend financial services why not do it through POSB?
According to Dr Douglas Zimbango, the managing Director of Zimpost, the onboarding of Steward Bank is just the latest in relationships that Zimpost has created with retail banks. Currently, Zimpost provides selected services from 4 other retail banks.
Steward Bank’s onboarding is not only an extension of that, but it also provides Zimpost clients with access to mobile money and the amplifying of a bouquet of services that EcoCash has always provided through its agents.
Dr Zimbango went on to say that Zimpost is mandated to offer a platform for service inclusivity and more importantly, its relationship with Steward Bank and EcoCash also represents a partnership that compensates for part of its technology deficiencies.
What comes next?
Steward bank, Zimpost and EcoCash have all been tight-lipped about the opportunities that they want to explore through this relationship, though Dr. Mambondiani has hinted on an inclusive product set for launch in 2016 which will take advantage of the entities’ strengths.
According to Dr Zimbango, medium to long term opportunities will be explored, which could involve a reciprocated access to Steward Bank and EcoCash networks to grow any future Zimpost services.
Without running the risk of speculating, one can assume that a partnership between these players has possibilities aligned to e-commerce (Zimpost does have a handle on shipping, freighting and last mile delivery), remittances (this is Zimpost, EcoCash and Steward Bank territory) or services tailored to the unbanked or the underbanked in rural Zimbabwe.
Natalie Jabangwe Morris, the head of EcoCash business could not confirm EcoCash’ involvement in any mashup of services, including remittances, though she did emphasize EcoCash’s objectives aimed at maximising subscriber value, especially through a party like Zimpost which can introduce a new client segment.
Here are some images from the launch