So this happened:
DESIGNATION OF ZIMSWITCH TECHNOLOGIES (PRIVATE) LIMITED (ZIMSWITCH) AS A NATIONAL PAYMENT SWITCH
In accordance with the provisions of the National Payment Systems Act [Chapter 24:23] and the Banking (Money Transmission, Mobile Banking and Mobile Money Interoperability) Regulations, Statutory Instrument 80 of 2020 (the Regulations), the Reserve Bank of Zimbabwe (the Bank) wishes to advise the public that it has designated Zimswitch as a national payment switch with immediate effect.
All mobile money transmission providers and mobile banking providers are hereby directed to be connected to Zimswitch as provided for by section 4 of the Regulations. To ensure seamless integration, all money transmission providers and mobile money providers must complete the necessary Installation or deployment or commissioning of Infrastructure and connection protocols, credentials and documentation for connection to Zimswitch by no later than 15 August 2020.
John P Mangudya Governor 9 July 2020Huawei P30 liteUS $175.00 HarareRedmi Mi 11 LiteUS $350.00 HarareHuawei Psmart 2021US $200.00 ZvishavaneHuawei nova 3iUS $134.99 Harare
The threat has come it seems
There has been talk of having one national switch for all transactions for a very long time. Such conversations started intensifying last year and it looks like the central bank has taken a definitive position. What this means is that all payments facilitators in Zimbabwe like banks, EcoCash and other mobile money wallets can now ‘talk to each other’ through Zimswitch.
The business that is affected by this the most is EcoCash because essentially everyone else is on Zimswitch. The mobile money service is a platform in itself with its own ecosystem that banks connect to on EcoCash’s terms.
Designating Zimswitch as the primitive platform that everyone else must connect to takes away incredible chunks of EcoCash’s market power. For example, nothing stops a NetOne customer from merely sticking to NetOne’s OneMoney and not open an account with EcoCash. From their OneMoney such a customer will now be able to send money to or receive it from EcoCash. OneMoney and EcoCash will thus compete on service, innovation and pricing. Of course the interconnection fees will also determine how far this becomes a reality.
We will look at this more closely as we get more details. Some questions to ask are around the fact that Zimswitch itself is a private company owned by some of the banks and a few other private owners. Is this the ideal set up?