It’s Tough Doing Business In Zimbabwe; The Story Of A Crypto Exchange

Be warned, this story will make you angry. We have been told time and time again that Zimbabwe is for sale open for business. This story will highlight just how empty that statement is, or at the very least get you asking just to whom (who?) is Zimbabwe open.

Tatenda Mabungu

Tatenda Mabungu is one of own, born and bred in Zimbabwe. He moved to South Africa in search of greener pastures where he has been based for years now. However, like most Zimbabweans living outside the country he still longs to see Zimbabwe prosper and wants to be part of the remedy.

The chance for him to be involved in the Zimbabwean economy came when Robert Mugabe was ousted from power and the new incumbent, President Mnangagwa declared Zimbabwe open for business. The new president assured Zimbabweans living abroad and the world at large that the perfect time to rebuild Zimbabwe had come.

advertisement

Tatenda Mabungu heard the message and his patriotic juices flowed right through to his purse-strings. He came back to Zimbabwe for about three months in order to set up a business here – Styx24.

Styx24

Styx24 is a cryptocurrency exchange which allows users to trade bitcoin, Litecoin and Dash. The exchange came in to challenge the monopoly of the biggest cryptocurrency exchange in Zimbabwe – Golix.

The guys over at Styx24 were not amused by Golix’s efforts. Styx24 was to come in offering cheaper transaction fees and an auto-refreshing trading page among other advantages.

The exchange went live in the first week of February 2018 but that was in spite of mounting challenges to set up the business.

 

Obstacles in setting up a business in Zimbabwe

It took Tatenda 6 weeks to register his company. He persevered through the long registration processes and ridiculous requirements until the business was registered.

However, when it came to opening a bank account for the business he found the going tough. He has been trying to open a bank account for Styx24 for 5 months now with no luck. He notes how he, a Zimbabwean, has bank accounts in Kenya and South Africa and yet fails to open one in Zimbabwe. He says it takes all of 10 minutes to open a business account in South Africa.

The banks he has approached have turned him down for different reasons.

Barclays (Kwekwe) not only turned him but were rude about it. Tatenda says it was like he spit in their faces when he inquired on how to open a new account. Standard Chartered (Kwekwe) were polite and professional but also turned him down.  Then there is…

 

BancABC

Tatenda has a personal account with the bank. He has had to use that account as Styx24’s business account. The experience? As terrible as it can get.

The bank owes him thousands and he has been trying to recover that money for months. How does the bank owe him?

Tatenda would effect a Zipit transaction (a transfer of funds between accounts at different banks) and it would fail. Checking the balance would confirm that the transfer was not made. He would try again and succeed.

All well and good except that the bank would notify him after a month or so that that first transaction which ‘failed’ had in effect not failed. The bank would then deduct the amount from his account for the second time.

Trying to resolve the issue with the bank has been an exercise in futility. The bank does not respond to emails, calling is as good as chucking airtime into the toilet.

 

Uneven playing field?

Why did he not open a business bank account with BancABC instead of using his personal account? I hear you ask. He tried, way back in February 2018. The response he got is baffling.

He was told that the Reserve Bank of Zimbabwe (RBZ) did not allow them to open accounts for businesses involved with cryptocurrencies. What? That was in February, months before the whole fiasco where the RBZ tried and failed to ban the trading of cryptocurrencies in Zimbabwe.

During that February, the other cryptocurrency exchange – Golix – was up and running and had multiple bank accounts in Zimbabwe. Tatenda asked how it was possible that Golix could have business bank accounts and yet Styx24 could not and he never got a satisfactory answer.

 

Big plans for Styx24

Styx24 has steadily been growing and the plan was to introduce two ATMs where users could buy or sell cryptocurrencies. One of the ATMs was to be placed at their offices in Harare and the other at the airport. The ATMs were bought and were ready for deployment when the RBZ happened.

Mid-May 2018, the RBZ banned the trading of cryptocurrencies, ordered Styx24 and Golix to cease operations, Golix sued and the ban was reversed. However, to this day even Golix does not have control of their bank accounts. Golix communicated that,

The interim relief does not guarantee that we will get our bank accounts reopened. We are working hard to get our bank accounts reopened…

The RBZ fiasco and the response of banks to that episode just piled on the difficulties for Styx24 to operate as a Zimbabwean company.

 

Styx24 moving out of Zimbabwe

The love of one’s country only takes one so far. Tatenda is now looking to move the business operations to another African country where conditions are conducive for entrepreneurs.

Zimbabweans will still be able to trade on Styx24 but Tatenda says in 2 weeks or so the company will be registered and operating from another country.

Yet another Zimbabwean business looks set to flourish outside of Zimbabwe. This is not because Zimbabweans lack patriotism but because of the 159th ranking out of 180 economies in ease of doing business.

 

State of Blockchain Technology in Zimbabwe report

Blockchain technology is what makes cryptocurrencies possible and in turn companies like Styx24. The technology however has so many other applications and Zimbabwean companies are utilising it.

Techzim recently released a report focusing on the practical applications of the technology, the companies currently utilising it in Zimbabwe and the barriers to adoption in Zimbabwe. The Styx24 story only came in after the report had been released.

To buy the State of Blockchain Technology in Zimbawe report simply Ecocash the fee of $4.99 to Techzim Merchant Number 83688 and then send an email with the reference number to admin@techzim.co.zw. For other forms of payment please email admin@techzim.co.zw


Quick NetOne, Telecel, Africom, And Econet Airtime Recharge

If anything goes wrong, chat with us using the chat feature at the bottom right of this screen

You might also like

Distributing the COVID-19 vaccine in Zimbabwe is going to be a nightmare

Some bank branches may never reopen because of COVID

Bridgerton is a fanciful Shonda Rhimes Netflix production starring a Zimbabwean

ZimboFit, a homegrown fitness and exercise app