Telone Reduces Interest On Business Bills From 2009

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Government-owned Telone has softened its stranglehold on debtors by reducing interest rates on their arrears that were accumulated in 2009. Many businesses and individuals are saddling huge debts that were incurred in 2009. The debts have been a moot issue because debtors say that their debts were inflated following the transition from the Zim Dollar pricing to US Dollar pricing era.

When TelOne started billing customers in US dollars back in February 2009, it was accused of having converted Zimbabwean Dollar bills to US dollars at unrealistic exchange rates resulting in ridiculously high bills which subscribers failed to settle.

Zimbabwe National Chamber of Commerce (ZNCC) has reported that the interest rates charged on Telone debts will fall from 3% to 0.04% and the reprieve will only affect businesses but sidelining households.

ZNCC, Branch Manager Golden Muoni stated that profitability in companies is being lowered because of exorbitant debts they have to clear to utility companies like Zesa and Zinwa and other parastatals. So the clemency offered by Telone will somewhat reduce the cost of doing business for companies.

As a business, obviously cost is something which sometimes in this environment affects our businesses. All the businesses they benefited really from that engagement that we did with TelOne,” Muoni said.

So, it’s benefiting because you are reducing the cost of doing business. It helps for you to increase your profitability because cost drives the business to unprofitability. The more your costs are increasing, the lesser you are making a profit.

Telone is losing subscribers as more businesses and more individuals are closing their fixed lines so as to avoid paying fixed charges and focus on paying off their debt. Thereby reducing interest rates, Telone is seeking to avoid losing customers who are now migrating to using mobile phones for their day-to-day communications.