HARARE - The Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) says mobile money platforms are key to bridging the financial gap through provision of better access to financial services in the current cash-crisis ridden economy.

In a sector perfomance report for the first quarter 2018, POTRAZ said mobile money subscriptions are expected to grow as all mobile operators have fully operational mobile money system that is linked to various banks.

"Mobile money services are expected to continue playing a key role in bridging the financial divide by providing safe, secure, convenient and cheap financial services in areas where many Zimbabweans have no access to formal banking systems," said POTRAZ.

"Volumes of mobile money payments are expected to maintain an upward trend due to the significant increase in the number of financial services offered on mobile money platforms."

The regulator  said the total number of active mobile money subscriptions as at 31 March 2018 was 5,500,625 up from 4,706,778 recorded in the last quarter of 2017.

This represents a 6.35 percent increase in active mobile money subscribers in the first quarter of 2018 when compared to the last quarter 2017 figures.

All the mobile operators experienced growth in the number of mobile money subscriptions with NetOne registering a more SIGNIFICANT increase.

"NetOne experienced the biggest leap in active mobile money subscriptions of 49 percent (recorded at 78,968 active number of mobile money subscriptions for the period under review) when compared to the last quarter 2017 figures (52,940)," said POTRAZ.

Econet's mobile money subscriptions increased by 5,96 percent to 4,847,014 for the period under review from 4,574,409 recorded in the 4th quarter of 2017.

Telecel's mobile money subscriptions increased by 0.27 percent to 79,643 from 79,429.

Overally, the entire sector saw a 6,35 percent increase in mobile money subscriptions at 5,005,625 in the period under review from 4,706,778 recorded in the last quarter of 2017.

"The current cash constraints have spurred mobile money bill and merchant payments to be used as an effective alternative mode of making payments.

"In the quarter under review, airtime, bill and merchant payments increased by 6% to record $772,307,418 from $725,510,160 recorded in the last quarter of 2017," said POTRAZ.

One of the advantages mobile money platforms offer is that it is easier to open an account and one does not go through a number of hickups compared to traditional banks.

Mobile money platforms have improved financial inclusion especially to areas where access to banks was largely limited an required people to travel to nearby towns and cities to access money in banks.

"Mobile phone banking technology is helping to include more and more people in Sub-Saharan Africa into the formal financial sector and the economy more broadly," said Moody’s(a global credit rating firm) in a report.

In a 2016 report, entitled Mobile Phone Banking Supportive of Economic Growth and Banking Sector Prospects, Moody’s said Sub-Saharan Africa was experiencing the world’s fastest rise in new bank accounts, fuelled by the growth in mobile banking.

The growth has driven an increase in access to financial services, giving opportunities for banks to expand services across the continent.

Zimbabwe among other countries like Kenya, Botswana, Rwanda and South Africa, Tanzania, Uganda and the Ivory Coast are all well-positioned to benefit from mobile money growth.

While the use of electronic forms of payment came as a result of cash shortages, observers say that it puts Zimbabwe well ahead of other countries across the globe that are working towards achieveing a cashless society.

The increase in the volume of mobile money transactions indicates that people are embracing the plastic money system.

Whichever way it ends, mobile money will have an impact on mobile network operators who are currently reaping benefits of mobile money transactions growth which has contributed significantly to overall revenue gains.

Econet has the largest market share through its Ecocash service followed by NetOne through OneMoney (rebranded from OneWallet) and then Telecel through Telecash service.

According to the data released by POTRAZ for 2017, over $11 billion was processed on digital platforms from January to September. Of that $11 billion processed at least $2 billion was mobile money.

Consumers are using mobile money transactions on airtime, bill and merchant payments and with supermarkets, clinics and pharmacies, ZESA and even the police accepting spot fines via mobile money.

- Equity Axis News