Ecocash on Expansion Drive, will They Surpass the Mpesa achievements?

ECONET Wireless is undertaking a multi-million-
dollar expansion of its mobile money service,
EcoCash, which will make the system four times
bigger. This will pave the way for the company to
launch additional services. In a statement, Econet
said the expansion was a response to the dramatic and unexpected growth of the service since its
launch.
The EcoCash service has recorded more than 2,3
million users since its inception two years ago and
by August last year, its agency network, which
includes individual traders, post offices and other businesses, had reached 7 000 agents. As of July this year, EcoCash was handling an
estimated US$200 million in monthly transactions
and when annualised, this volume represents an
amount equivalent to 22 percent of Zimbabwe’s
GDP. Expansion of the service would mean the country’s
largest mobile phone network would be able to
rake in the forecast US$1 billion a month.
Econet customers, who were originally using the
platform to send and receive money, can now use
EcoCash to make all sorts of payments, including paying salaries. This has created employment opportunities while
the platform has been touted as facilitating the
movement of cash across the economy efficiently
boosting trade in the country’s mostly informal
economy. Econet has been forging alliances with local banks
such as CBZ, Steward Bank and Stanbic Bank to
support the facility. The acquisition of a 100
percent stake in Steward Bank by the mobile giant
also saw the giant further integrate the large
informal sector into the formal banking system. Econet said that engineers from the company’s
suppliers have been in the country for several
weeks upgrading all the systems and they are
expected to have completed their work by the end
of September. “Our executives concede that they have been
caught by surprise by the dramatic growth of
EcoCash, and have had to scramble to order and
install a much bigger system,” the company said. Econet Services chief executive Mr Darlington
Mandivenga said the expansion of EcoCash would
allow the company to launch new services on the
EcoCash platform. He added that the company had already activated
the EcoCash service for Zimbabweans in South
Africa that would see an increase in the volume of
remittances to the country. He, however, said the service was currently
available from a few limited sites in that country
until the full upgrade in Zimbabwe was complete. “If we open up the service completely, we will have
complete congestion. We have to wait two or three
weeks,” he said.
Mr Mandivenga said excitement over the product in
South Africa was very high because it solved the
problems people were experiencing when sending money home. Statistics show that Zimbabwe accounts for the
bulk of the cross-border remittances market, and
more than R6,7 billion, which translates to 60
percent of total Sadc remittances, is estimated to
be sent to Zimbabwe from South Africa each year. Analysts believe that EcoCash could surpass the
achievements of the largest mobile money service,
M-Pesa, run by Kenya’s Safaricom.

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