The latest POTRAZ report is out and OneMoney grew exponentially in the first quarter of 2020. 18.4% growth means NetOne’s mobile money service now has 555 225 subscribers.
This time last year they had just over three hundred thousand subscribers so it’s interesting to see the mobile money service add over quarter of a million subscribers in a year.
How have we gotten here?
NetOne’s payroll solution OnePay was a big contributor and on the back of 97% user growth between Q2 and Q3 2019, NetOne’s Head of PR mentioned the following;
The OnePay facility has been well received by several institutions including corporates mainly for salary and stipend payments, NGOs, farmers, as well as institutions that process grants and other social security payments only to mention a few.Eldrette Shereni – NetOne Head of PR
Ultimately OnePay meant that a lot more people were receiving money into OneMoney mobile money wallets than before and NetOne had to come up with a way to ensure that these people kept the money in there. How did they do this?
Well, they announced a promotion in November of 2019 that would allow OneMoney users to transact for free until the end of the year and whilst they couldn’t replicate the 97% user growth of Q3, OneMoney still grew by a respectable just under 10% to 488k subscribers.
This move to make transactions free seemed to be popular outside of just on-boarding new users. According to NetOne, it resulted in 19 000 agents and 11 000 merchants signing up which in turn made OneMoney more usable by members of the public.
OneMoney: The popular choice for money changers
The announcement of the aforementioned promotion was great for user growth because it incentivised money changers who play a much larger role than they should in Zimbabwe’s economy. Because transacting using OneMoney was free, money changers were incentivised to use this platform more than EcoCash since their profit margins were higher when they didn’t have to pay to transact.
A trend began to develop where some money changers would altogether refuse to trade using EcoCash instead insisting on using OneMoney (and offering better rates on OneMoney) and bank transfers exclusively.
This, in turn, incentivised NetOne who had probably witnessed the growth of OneMoney to continue using the free transactions as their primary user acquisition strategy and so just before the year ended, NetOne announced that they would be extending the promotion to March of 2020.
EcoCash nightmare upgrade
It’s also easy to forget what was arguably one of the worst upgrades (if not outrightly the worst) we’ve ever seen from a local financial institution. The EcoCash upgrade of November 2019.
Whilst it’s not easy to quantify just how much of a boost EcoCash’s two-month upgrade was to NetOne I think it’s fair to assume that both consumers and service providers understood the importance of having a backup service provider.
Whilst it’s impressive to see NetOne clearing the half a million subscriber mark for mobile money users, the harder thing will be keeping the users there in the long run and continuing to chip away at EcoCash’s dominance.
Will OneMoney continue to be an attractive channel for transacting to consumers once the promotions have been put on hold. Also, how NetOne handles growth will be one of the challenges going forward. At 555k subscribers, they have 12 times fewer subscribers than EcoCash – meaning there is far less strain on their hardware as they process fewer transactions.
What role will government play in all this?
One advantage NetOne seems to have is the fact that government seems hellbent on giving them a helping hand since they are state-owned. The most recent example of this is how the government intended to distribute COVID-19 relief funds solely using OneMoney.
Such a move would’ve resulted in NetOne gaining over a million subscribers overnight and I’m sure a significant portion of OneMoney’s growth in Q2 might be backed by this (that’s if government gets around to actually distributing the funds).
This favouritism has also been cited by the public as the reason why the government is currently targeting EcoCash and not as much scrutiny is placed on OneMoney when financial authorities are attributing the economic woes to illicit forex trade on mobile money platforms.
A number of transactions have been banned on EcoCash but to the best of our knowledge these are working just fine on OneMoney. Another advantage and incentive for people to use EcoCash right now – and OneMoney doesn’t seem to have earned that in any way.
Ultimately, it will be interesting to see if NetOne can still achieve their goal of dethroning EcoCash in 2 years. They have 15 months left, making it extremely unlikely
4 thoughts on “OneMoney Crosses Half A Million Subscriber Mark – How Did They Get There?”
This is just the beginning. We moving over to a more digitized country on so many different levels. Finance is only one part of it. I am glad we are embracing this type of fintech. Amen
We all know why people are now flooding to open a netone line coz of the political ( again ) crack down on ecocash and a higher rate being offered on the street for onemoney. Nothing more! Common sense.
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