The Reserve Bank Of Zimbabwe has responded to Ecocash urgent application with a very interesting twist, name calling it a Ponzi scheme as it alleges that Ecocash is not settling transactions in time, creating fake virtual currency.
If the Reserve Bank was serious about this statement, we must have heard them speaking if cancelling licences from illegal player, not name calling a service provider, unless ofcourse they know the there is no basis.
Ecocash had filed an urgent high court hearing against suspension of their mobile money agents from conducting financial transactions and restore full functionality.
This is a strong allegation and should it be proven , it has strong implications, however it goes without saying it boggles the mind who may have been funding such accounts with a vague “suspense account” to only settle days later.
The RBZ alleges :
“What the general public does not know is what happens in the interim. The funds that have not been credited to the vendor or the recipient are then available for trading on the Ecocash Platform in the foreign currency market. In effect, the delays allow a certain person, who was the subject matter of an investigation, to buy and sell foreign currency in the intervening period.”
Mangudya said investigations have established that there are some Ecocash agents who have an overdraft on their Ecocash accounts in excess of $39 million. This begs the question: “How can an entity or individual have an overdraft on an electronic payment platform such as Ecocash?”
This is a very interesting question asked by the central bank, but its rather selfish in its nature. The Reserve bank can not want to investigate a “technical fault” now but when millions complained over disappearing balances it never called the system a Ponzi scheme.
Why are they now ruling out chances that this could have been a simple issue of system challenges delaying to settle, the same way they have accepted the initial narrative when millions were saying their balances were not correctly reflecting.
The Reserve Bank of Zimbabwe recently closed 100 ecocash accounts for allegedly transacting not over the stipulated $100 000, driving the total monthy transactions to $75 million.
According to the law, its not illegal to transact up to the figure, the amounts of the transactions and the value can be curious but this does not make it illegal.
What is more interesting and rather illegal is the fact that Ecocash is said to be delaying to settle accounts of currency in circulation then settles later later days.
This could be tantamount to creating own currency.
Who are the beneficiaries of these funds, when they receive these funds, under what pretext are they receiving and who is the sender, claiming what source ?
But the fact that this money was or is already in the system must have been the real issue. How did we end up with $39 million being illegally circulated, if at all it was illegal, how was this money initially pumped into the Ecocash system because there is no currency without source.
when all is still said and done, t goes to that one problem that the reserve Bank is reluctant to fix.
Zimbabwe has a liquidity crisis, crated partly by the same Reserve bank when it looted real bank balances and introduced its own virtual currency called bond notes, when Zimbabweans had deposited USD into their accounts, they withdrew another currency which was purportedly backed by the Afreximbank.
We are yet to hear what really happened with the backing value, did they dishonor this since the bond notes were never announced not to have a backing anymore but were simply devalued.
The biggest problem however is how we rate the USD against this same surrogate currency. The RBZ has continued pegging this currency at lower rates, a sensible move to preserve debts value for corporate that borrowed in USD but still an impossible offer to anyone who wants to trade.
The problem always haunts us, why do we have a buying rate for the USD and yet business does not have a buying market of the same product?
This is the elephant in the room that the reserve bank must be tackling, not Ecocash.
Ecocash is not a currency but a medium to exchange payments, while most Zimbabweans have taken this same medium to be the currency itself, like USD is no longer a currency, but a form to preserve value when the local economy continues n a free fall.