Yesterday, Econet made an announcement via a release to assure the market that issues (these, issues) have been resolved with “virtually all banks” and that if everything works according to plan, all banks that want to be connected to EcoCash, would be integrated by end of March 2013. According to the release Econet is apparently responding to fears by some financial institutions that they’ll lose customers to EcoCash integrated banks. We don’t know of these fears, but we are not bankers…
What we see though is as a warning from Econet (or word of advice, or ultimatum, or more simply ‘hey banks here’s the deal’) to either integrate on Econet’s terms or risk losing customers to those banks that do. As a Stanbic executive gave in when he was asked by journos how many of the bank’s customers would benefit from partnering EcoCash: “Econet has 8 million subscribers,” he said “any other statistic pales in comparison”. Maybe the fearing bankers Econet refers to realise that too.
The argument from the banks is that integration should not be on Econet’s terms – it should be on the regulators’ they say. The Reserve Bank of Zimbabwe and the Postal and Telecommunications Regulatory Authority of Zimbabwe that is. The banks say that leaving the terms to Econet provides Econet the attractive opportunity to anti-competitively use its 8 million strong subscriber base to push EcoCash, while denying fair access to their network to rival Mobile Banking (and Mobile Money/ Banking hybrid) products like Text-a-cash and Mobile Moola.
What’s worse, Econet itself now owns a bank.
As you may know though, Econet has already moved to fix the ‘open payments switching platform’ aspect of things; they just hired an expert in that area to head EcoCash. Now, if ‘open payments switching’ sounds like what ZimSwitch has been doing for decades, that’s exactly what it is. Econet recognizes that the center of payments switching is shifting fast to mobile telecommunication networks, and that they’d be silly to hand over the core of their empire to the banks!
Here’s the full press release:
Econet Wireless has reached agreement with most of the banks on EcoCash integration, and the process is now progressing smoothly.
The company sent a message to all of its more than 8-million customers – many of whom were anxious that their bank would not be connected – that issues have been resolved with virtually all the banks and integration is progressing.
Bank integration appeals to top customers of Econet who already have bank accounts. Econet said when a bank is integrated, a person can undertake banking from anywhere in the world at any time of day. “You can move money from your account, and send it to someone in Zimbabwe even at midnight from China; it is that flexible,” said the company.
People who run businesses are using EcoCash integration to deposit money into their accounts after banking hours, avoiding having to hold onto cash, Econet said.
The company said banks that do not have integration have been concerned about losing customers to those banks that are already integrated with EcoCash.
Econet has however assured them and its customers that by the end of March, every bank that “wants to be integrated” would be integrated.
An Econet senior executive, Mr Darlington Mandivenga, said that he expected every single bank to be integrated by the end of March.