Yours truly has always been itching to throw his 2cents on the hot issue of paying premiums to access cash from Ecocash agents, In fact, the rates from the informal market have risen to more than 45%, to simply get that money out.
However, the transaction charges are depended on the nature of the cash to be cashed out. Coins attract lower rates than notes.
The astronomical charges have ignited anger among the affected constituency “consumers”. Their ‘misdirected’ anger which is directed at Econet and Ecocash has pushed ZACC and RBZ to act, which is honestly too micro for them to manage when we expect them to deal with real corruption cases.
In the famous words of DMX I would respond,
“Guns do not kill people, people kill people!”
Ecocash is simply an electronic channel which can be used or abused by anyone ruing on it, but certainly its not the problem behind our cash crisis.
I wish people could understand the dynamics of their current problem to make an informed action. Yours truly will try to breakdown the issue at hand.
Here is the harsh reality, as the actual foreign currency rates continue to go up, the street premium charges respond proportionally, driven by the huge cash and electronic figure difference.
Currently, Ecocash as well is one of the most paying Bureau De Change players, paying better rates than the black market street guys at times, but here is the irony, very soon, deposits in Ecocash will be worthless value.
This whole thing of people adding a premium to withdraw the cash has already created two prices in most shops one for Ecocash and thew other cash, strange enough, the case is not so for those swiping, will look into that later, lest I deviate.
This is largely driven by inflation and government’s tightening of screws as they refuse to increase daily bank limits, millions have resorted to “buying cash” if your bank can not dispense, which technically has become a norm.
With that trend currently ongoing, I have seen many people pour their rage against Econet and Ecocash for providing such a system that allows people to “buy cash” at a premium, ultimately diminishing the dollar value of funds on Ecocash.
Those people that really need and are desperate for cash will have to simply pay, losing almost half the value, Why? Because they are some things you simply need to do with cash, like daily commuting, buying daily consumables like tomatoes, vegetables, etc.
But hold on, these are not expensive responsibilities. And the biggest question is why is there so much demand for cash if people need it for petty expenses?
RTGS value versus hard cash has jumped by almost 100%, This is the real driver of cash premiums!
If one today has $890cash he can easily and quickly get 100USD, this is however not so for one with a bank balance of the same figure, you will need to use 1550 RTGS bank balance to buy the same amount from the streets, and yes all the official Bearue De change are also willing to pay you that much for your $100 USD.
This is the catch and where we must all be focusing on as the driver behind premiums in forex trades today not Ecocash or bank rates.
From the streets its willing buyer and a willing seller, if you don’t want to promote those mad rates, or is it mad rats, then just don’t buy money, live within your cashless means and where you can try and be very patient at your bank.
Increasing daily bank limits could help ease the pressure on suffering Zimbabweans, but then remember, this feeb easy cash into the system, allowing people to buy more USD via cash, which drives the rates up again.
So instead of protesting and attacking Ecocash as a technological enabler, our people need to be educated and fully understand the system
Yes, Ecocash can close rogue agents, yes Ecocash knows who is pushing huge volumes and figures involved in illegal transactions and once more again yes, Ecocash makes its revenues and profits from this same system, because it’s a business.
More effort must be done to quickly have people or system trigger for suspicious transactions. But even if Ecocash closes all these rogue players, how does this make cash available to you as a user because the problem hear is on liquidity, not Ecocash.
If somehow Ecocash closes all possible rogue players, still they will move to other platforms like Banks, one money or Telecash because the problem is not within mobile money transfer system, but lack of the government to create a system that cultivates a cashless society in a stable economic environment.
The premium rates will skyrocket above the current 45% once Ecocash closes all these rogue players because those who will be left will put new charges called risk element, and force inflation up as well which is really retrogressive.