HARARE – Zimbabwe’s mobile and Internet transactions breached the $1 billion in March, as locals migrate to cash-lite payments on the back of acute cash shortages.
Data from the central bank indicates that mobile and Internet transactions in Zimbabwe — which has been battling a cash crisis for over a year — closed the month of March 2017 at $1,1 billion up from the $796,3 million recorded in February 2017.
“Cash transactions stood at $316,6 million in March 2017, a 12,1 percent decline from $360,4 million recorded in February 2017.
“However, the total value of mobile and Internet-based transactions closed the month of March 2017 higher at $1 billion, compared to $796,3 million registered in February 2017,” the John Mangudya-led Reserve Bank of Zimbabwe (RBZ) said in its monthly report for the month of March.
The apex bank also said the value of card-based transactions at $451 million in March 2017 had gone up from $385,7 million recorded in February 2017, with most Zimbabweans now forced to use Point of Sale (POS) purchases in the absence of a cash alternative.
In value terms during the month of March, total cheque transactions increased from $7 million in February 2017, to $7,4 million in March 2017.
Since the country’s cash shortages began, cash-obsessed locals have been forced to migrate to alternative payment methods with the RBZ aggressively lobbying for a migration to cash-lite transactions.
The central bank is also moving to review electronic transaction fees downwards, in a move aimed at promoting cash-lite payments.
Mangudya recently said in the wake of pressing cash shortages, the apex bank was working on a raft of measures to promote the enhanced use of plastic and electronic money which currently accounts for 70 percent of retail transactions.
While there has been a lot of lobbying for Zimbabweans to dump a cash-based system in favour of cash-lite transactions, uptake has been low with market watchers pointing out that the reason the transition is slow is because Zimbabweans have little trust in the local financial sector.
According to the 2017 Monetary Policy Statement both mobile and Internet transactions have been on the rise.
Mobile money payments in Zimbabwe accounted for 81,2 percent of all electronic payment transactions maintaining the dominance mobile money services have had in transaction volumes, with this increase in alternative cash methods attributed to the cash shortages.
In 2016, 298 million mobile money transactions were handled, up from the 228,2 million in 2015.
In the same drive, the POS footprint in the country has increased 11 percent to 32 540.
As the country’s cash shortages peak, the RBZ has resorted to several measures to minimise the use of hard cash, with increasing POS infrastructure at the core of this thrust.
Last month, the apex bank pegged the maximum “cash back” withdrawal at $20, arguing the measure was aimed at curbing cash hoarding.