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COVID-19: Data charges hit struggling consumers

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COVID-19 has changed nearly every aspect of our daily lives, and consumer spending is no exception.

Equally, the economic consequences of the coronavirus pandemic have meant consumers are less inclined to spend more, with many’s incomes continue to fall.

Unproductive time spent indoors however, has caused many people to prioritise food stuffs and other basic commodities.

The current COVID-19 induced lockdown coupled with unaffordable data charges have literally made life difficult for internet addicts.

According to POTRAZ’s 2020 first quarter report, there was a decline in Data and Internet subscriptions – the active internet and data subscriptions declined by 2.5% to record 8,614,401 from 8,836,299 recorded in the previous quarter.

In respond to the regulator’s approval of 57% increase in voice, data and SMS tariffs early this year, the telecommunications industry adjusted tariffs in line with the prevailing foreign currency rate.

Recently the players again increased their tariffs.

Although the tariffs are fair in comparison to charges before the de-dollarisation era, affordability has been the major challenge among consumers.

This has also been necessitated by a struggling economy which restricts periodic salary adjustments.

Popular WhatsApp bundles cost between ZWL$5.80 to ZWL$150 depending on data size and mobile service provider.

The bigger the data size, the higher the purchasing figure and the more it would last and vice versa.

Data bundles cost between ZWL$9 – ZWL$1500 again depending on size and mobile service provider.

The most expensive package which provides approximately 15Gigabytes is beyond the majority’s purchasing power.

ZOL Zimbabwe has priced its data in USD terms.

The local Internet Service Provider increased its prices by almost 200%.

With the current black market rate of 85 to 90. It means 100GB is costing around 60USD. 3 months ago the same 100GB was priced around 25USD.

Some of the unjustified and abnormal price increases have heavily impacted the consumers who are also grappling with COVID-19 pandemic.

Consumers who spoke to TechnoMag expressed their displeasure over the current data charges with some turning to VPN to evade costs.

“Sure data costs have become so expensive, but for me being active on social media has become a norm , I literally squeeze in a budget for my data , but with the data costs growing I forsee myself struggling to meet costs,” one consumer told TechnoMag.

“I have been using a free VPN over the past months to try and by pass buying data, but its actually a struggle as sometimes the vpn will not be connecting,” another one retorted.

“I miss the 90cents WhatsApp bundle , the $3 monthly as well back then the story was different , now I can go for 5 days offline failing to buy data.”

Media Institute of Zimbabwe have been advocating for data tariff reduction.

In their statement on April 8 MISA said, “It is MISA Zimbabwe’s well-considered view that the costs of mobile data in Zimbabwe is prohibitive and discriminates and infringes on citizens’ right to access to information as provided for by the Constitution and the African Declaration on Internet Rights.”

Consumer spending is one of the most important driving forces for global economic growth.

Beyond impacting some of the factors that determine consumer spend—such as consumer confidence, unemployment levels, or the cost of living—the COVID-19 pandemic has also drastically altered how and where consumers choose to spend their hard-earned cash.

While some industries are in a better position to weather the impact of this storm, others could struggle to survive.

As consumers grapple with uncertainty, their buying behavior becomes more erratic. What is clear however, is that they have reduced spending on all non-essential products and services.

Why call them domestic nostro when they are just RTGS?

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