Mobile money agents 'run out of cash'

SCORES of mobile money agents have reportedly run out of cash due to swelling demand after most depositors transferred their monies from their bank accounts to cellphone-based platforms.

With banks limiting daily cash withdrawals to as low as $50 yesterday, many clients had sought refuge in mobile money operators - EcoCash, One Wallet and Telecash, which are run by the country's mobile phone service providers.

A snap survey by Business Chronicle in the central business district yesterday revealed that most agents had little or no cash on them while some had floating balances only.

An EcoCash agent who requested anonymity said: "We only have money in the (cell) phone, and no cash because people are cashing out more than they're cashing in. That means our floating balance is high but we've no cash to give to people."

Another agent said he had carried out cash-in transactions of only $190 by midday but could not be drawn to say how much he usually made on busy days.

One other agent said she had reduced the daily withdrawal limit per day for fear of wiping out her daily float balance.

"You can have one customer coming in and wanting to cash out $500. My daily limit from Econet is $300 so if I allow that person to take what I've I won't have any money for the rest of the day," she said.

Econet Corporate Communications officer Lovemore Nyatsine said "EcoCash has also been affected by the cash shortage in Zimbabwe but is endeavouring to ensure cash availability to its clients through the extensive agent network.

"However, the cash shortage highlights the benefits of switching to mobile and card-based transactions. EcoCash has seen a rise in electronic payments and is now actively promoting the use of EcoCash wallet and EcoCash cards for purchases."

Nyatsine said naturally, because of the cash shortage, volumes will be affected "but we can't at this stage quantify by how much".

However, mobile money operators are also making a killing out of the cash crisis because they charge an average of $3 per $100 transaction.

This means for a transaction of $500, a customer loses $15 to each transaction, while the bank will charge about $2 per $100 transfer plus $5 handling fee.

The country has been experiencing a cash shortage for the past few months, which the central bank blames on massive externalisation, low exports and hoarding of the US$, which is on high demand because of its strengthening value against other regional currencies.