Cashless transactions deepen in Zimbabwe

Harare – The growth of cashless payments over the past year has been worthy noticing, it being one of the economic development targets by the new administration, it should be noted that the popularity of plastic money in Zimbabwe has been bolstered by the deepening economic crisis characterised by foreign currency and cash shortages.

For the sake of comparison, countries like UK, Canada, and France rank among the world’s most cashless countries based on six metrics: the number of credit cards per person, the number of debit cards per person, the cards issue that have contactless functionality, the growth of cashless payments, payment transactions made using non-cash methods and the number of people that are aware of what mobile payments they have available to use.

The aforementioned payment methods have become synonymous to Zimbabweans, the difference unlike in UK, France and the other top-ranking countries which boosts a stable economy and currency, Zimbabweans are fast embracing this solution in a desperate measure to survive the deepening economic crisis.

Government on its part has not admitted to this harsh reality, instead it has embarked on a PR stance placing the country well ahead of many of its regional counterparts as a cashless economy and digital expansion hub.

The issuance of credit cards, point of sale machines (POS) as well as growth in mobile money payments grew by larger margins in the previous year, the latest National Payments Systems (NPS) report for the Q3 2018 shows.

Major highlights from the report include a 2 percent decline of cash payments from the second quarter ending June 2018 recorded at 765,120,271.41 to 746,851,103.26 in the closing quarter.

Foreign currency payments fell by 33.75% to below $1 billion, a trend which has been common in every Q3 since 2015. This will most likely continue to drop considering that payment of duty in the importation of cars and other commodities is now paid in foreign currency.

Banks, other financial institutions and most businesses are quickly embracing the new digital systems in the face of a crippling economy. More than 40k new POS machines have been issued compared to the same period last year.

The value of RTGS transactions in particular has grown, accounting for 23,207,897,724.60 by the end of Q3. The value of mobile transactions accounted for 13,467,617,033.80.

The number of credit cards has increased with close to 500k new debit cards showing that most Zimbabweans are left with no choice but to embrace the digital channels, taking note of the new 2% tax which has left many mourning.

In another reflective move towards plastic, 6.01 million active mobile financial services subscribers registered in the period under review from 5.48 million registered subscribers recorded in the previous quarter.

The value of cash withdrawals decreased by 2% from $0.77 billion in the quarter ending 30 June 2018 to $0.75 billion recorded in quarter ending 30 September 2018.

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