Econet sets sights on money transfers in SA

Money Transfer

Zimbabwe’s biggest mobile network operator Econet Wireless is targeting 1-million registered mobile money transfer customers in SA within the next 18 months.

Earlier this month the company was given the green light by the South African Reserve Bank to roll out its money transfer service in SA. The EcoCash service will see cross-border cellphone money transfers taking place from SA to Zimbabwe. So far 4.2-million customers in Zimbabwe have signed up for EcoCash.

Econet has partnered with Flash Mobile Vending, a subsidiary of Pepkor. Flash, in turn, partnered with Mercantile Bank and received the Bank’s approval to operate the new Flash to EcoCash remittance service in SA.

The World Bank estimates that every year more than $580bn in remittances are sent globally, with $436bn going to developing countries such as India, China, Nigeria, and the Philippines.

Money transfer services generally partner with banks and, increasingly, with telecoms operators. Mobile money allows users to make different kinds of transactions including paying bills, making purchases and sending money.

But the vast majority of mobile money services are not interoperable, meaning that one cannot send from one type of service to another. They also did not have the ability to send money across borders to other countries, WorldRemit senior mobile analyst Alix Murphy said.

In April, MTN and Vodafone announced an agreement that enables MTN Mobile Money and M-Pesa customers in East Africa to transfer money to each other.

Econet said the new remittance service would initially be made available to customers of Econet Wireless in SA, which operates the Call Home mobile service partnership with Cell C.

Econet and Cell C have a mobile SIM card and price packages aimed at Zimbabweans living in SA to enable them to call home. Econet’s South African customers will have to comply with the Financial Intelligence Centre Act to access the remittance service.

They will have to use their call home number, which will be linked to their remittance account. The number will be registered for their own EcoCash account. Once registered, the customer’s remittance payment will be immediately converted from SA’s rand to US dollars and transferred through the Flash–Mercantile Bank system to the customer’s EcoCash account. From that point, the money is effectively in Zimbabwe and the customer can use any of the EcoCash services to make transactions.

"The whole Flash to EcoCash remittance experience is designed around the customer’s mobile service and will offer the ultimate in convenience, speed and flexibility to the Zimbabwean diaspora in SA," said Econet.

About 95% of all remittances are sent offline, using traditional money transfer companies such as Western Union or MoneyGram.
Source: BDLive  29 June 2015