Bold revamp doubles EcoCash capacity

AN extensive revamp of the EcoCash platform that sent markets into complete turmoil in November last year doubled the mobile money transfer operation's capacity to 450 transactions per second, according to the firm's parent, Cassava Smartech.

Previously, the EcoCash system had capacity to handle 200 transactions per second, before bold steps were taken to revamp it and almost grounding a fragile economy.

EcoCash's gridlock wiped out potential revenue running into hundreds of millions from the Zimbabwean economy, which has heavily relied on the firm for payments since a grinding cash crunch erupted from 2016.

The Postal and Telecommunications Regulatory Authority said at the time the EcoCash mobile money platform accounted for about 99% of combined transfer services in Zimbabwe.

This demonstrated the importance of EcoCash to Zimbabwe.

EcoCash is operated by Econet Wireless' sister company, Cassava Smartech, and was the second biggest payment system after swipe cards in value terms at the time.
Last week, Cassava, which also controls Steward Bank, said the gridlocks were now history.

"The core banking system upgrade at Steward Bank is due to be completed in December 2020 and will be instrumental in driving our bank's digital agenda," the firm's chairperson Sherree Shereni said in a commentary accompanying financial results for the half-year ended August 31, 2020.

"The upgrade will also enhance regulatory compliance initiatives, whilst enhancing Steward Bank's ability to offer a wider scope of services on its digital platforms.

"The new EcoCash system, which we migrated to in the previous financial year, has stabilised and we are proud to announce that all issues that occurred during the changeover were adequately resolved. The system now has capacity to complete 450 transactions per second from an average of 200 transactions per second before the upgrade."

But it has been a frustrating year for EcoCash.

It has seen its business suffer constant disruptions, as terrified authorities blamed mobile money firms for abetting an inflationary rage, which triggered relentless price hikes.

Shereni revealed how the volatile terrain stifled business.

"There have also been a number of regulatory directives issued by the RBZ (Reserve Bank of Zimbabwe) during the period under review which have impacted our business," she said.

"The directives include a revision of customer transaction limits, suspension of certain user and transaction categories, and banning of multiple wallets for individuals.

"In compliance with SI (Statutory Instrument) 80 of 2020, EcoCash has now integrated with ZimSwitch, which the RBZ designated as a national switch.

"The group has also applied to RBZ for EcoCash to be designated as a national switch.

"We continue reviewing our tariffs, which are approved by the regulator, maintaining a balance between inflation, business sustainability and affordability to our customers.

"The regulator approved a tariff increase in August, which has had a positive effect on business performance.

"We expect the full effect of these changes to impact our financial performance in the second half of the financial year."

Cassava suffered a 34% slide in revenue during the period to $5,4 billion, compared to $8,2 billion previously as a result of interruptions to economic activity and the regulatory pronouncements.

The group posted a $1,5 billion loss, from a $27 million profit previously.