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Mangudya suspends mobile money agents

by Staff reporter
27 Jun 2020 at 19:51hrs | Views
The Reserve Bank of Zimbabwe has suspended mobile money agents from facilitating mobile financial transactions and has placed restrictions on merchant transactions.

This follows a pronouncement by Government yesterday that mobile money platforms along with the Zimbabwe Stock Exchange be suspended for suspected nefarious activities, which were creating instability in the economy.

According to the RBZ, mobile money agents are suspended from facilitating mobile financial transactions with immediate effect. In April, RBZ froze all Ecocash agents accounts that transacted for more than $100 000 per month with the exceptions of select categories but this is now a blanket ban on all transactions across all platforms.  

Further all merchant transactions are suspended except for receiving payments for goods and services as well as payment of utilities. These utilities, which include water, power and airtime have been limited up to $5 000 per day for the convenience of the transacting public. The overall effect of this move will however result in a total rejection of mobile money payments particularly in small counter sale operations such as bottle stores, bars and small retail outlets due to restricted movement.

All bulk player transactions have been suspended.

RBZ governor John Mangudya said the measures had been necessitated by the need to protect consumers on such platforms from abuse by what he termed unscrupulous and 'un-partisan' (he probably meant unpatriotic) individuals and entities to create instability and inefficiencies in the economy.

He assured that bona-fide transactions will be processed normally although he further directed that all money liquidations will now take place through the banking system. This is largely meant to promote the interoperability of the systems. However, the banking system is not as widespread in the country. Most banks have since closed down branch networks or agent banks in smaller towns while cash withdrawals continue to be challenging across the country. Unless there is a commensurate increase in cash in circulation (which will in turn marginally impact the IMTT taxes), this will drive up the premium on cash, which registered a 7% increase today to 75 from 70 which was on offer yesterday.

The press statement from Information Permanent Secretary Nick Mangwana had serious allegations against mobile money platforms, which include non-compliance with directives issued by the RBZ and FIU and the hiding of irreconcilable accounts in suspense accounts, which hold huge credit balances for long periods. The RBZ should have done well to provide a progress update. Overall, however, the governor did well in ensuring that the mobile money system remains largely functional for the general populace while regulations are fully strengthened.

Source - finx