The current economic meltdown coupled with a serious cash crisis has forced every Zimbabwean citizen to adopt the use of electronic payment systems such as card swiping mainly in retail shops. Mobile money platforms such as Ecocash, Telecash and OneWallet have found their place in the same financial market mix.
By Cisco Eng. Shingie Lev Muringi
Despite these electronic payment systems ushering in convenience to the bankable public, the regulatory bodies such as ZimSwitch and the Reserve Bank itself have been reluctant to fairly review the charges as some of them still remain exorbitant to the consumer.
In June earlier this year, the Reserve Bank Governor Dr. Mangudya announced that charges for electronic payments have been cut after an agreement between the RBZ, banks and other service providers. Nevertheless, a continuous review on the charges being exerted onto the consumers are still on the high.
Real-time Gross Settlement System (RTGS) which is now the most desired way of transferring funds at inter-bank level was once pegged at $10, later slashed down to $5 after the June resolutions. This means that most Zimbabweans who are now resorting to pay rentals and other social amenity costs using bank transfers have to fork out a minimum $5.
All Point-of-Sale (POS) transactions which exceeds $10 are now pegged at a minimum costs of 10 Cents from the previous benchmark of 35 Cents. The maximum charge on POS transactions using ZimSwitch is now pegged at 45 Cents whereas consumers will be charged a maximum 20 Cents if they are swiping on POS machines from their own banks.
On the other hand, when using mobile money platforms such as Ecocash to pay for groceries in particular, the consumer is charged a minimum of 12 Cents for every transaction below $5 while the maximum charges will amount to $4.95 when transacting for goods worth $300.
Barclays Bank in particular has $2.50 pegged as minimum fee when swiping using International Debit Cards. Stanbic on the other hand charges a minimum of $1 per transaction with other charges varying depending on whether you are using a local debit card or international cards such as Visa or MasterCard.
The Reserve Bank has been pushing for the adoption of plastic money via the increase use of bank cards and other electronic payment systems as part of its strategy to respond to the deepening cash crisis. However, the most repelling factor has been the high charges being levied by banks on their Debit, Visa and MasterCard, forcing the public to shy away from plastic money, resorting to cash which is now in short supply.
According to the latest data available from the Reserve Bank, $402 million worth of retail transactions went through the POS payment platforms in the last quarter of December 2015 as compared to the $420 million recorded in the same quarter of 2014. The $18 million windfall shows that the public has been heeding plastic money due to the exorbitant fees charged by banks.
However, on a much positive note, mobile money has been the biggest mover of electronic transactions in economy, with the latest statistics from the RBZ showing it accounts for 89 % of all the transactions in the country.
To sum up, if you factor in 10% for all overhead bank transactions added to the minimum values of 15 Cents being charged by service providers during transactions, you will find out that an ordinary Zimbabwean has to incur a record $139 in services fees per month.