BANKS remain relevant and were not afraid of competition from mobile money transfer agencies (MMTs), FBC Holdings chief executive officer John Mushayavanhu has said.
MMTs, he said, transact small amounts.
Speaking at the group’s analyst briefing in the capital last week, Mushayavanhu said the introduction of money transfer products by telecommunication companies Econet, Telecel Zimbabwe and NetOne was welcome as it brings financial inclusion.
Zimbabwe’s mobile transacting market is already using various payment platforms such as Telecel’s Telecash, Econet’s EcoCash, NetOne’s One Wallet, and Nettcash, a Nigerian cash transaction platform.
“We welcome the coming on board of Telecash and One Wallet as this will result in financial inclusion. However, the transaction is for small amounts, but the need for banks will not go away,” Mushayavanhu said.
“Even in Kenya where MPesa started it did not take away what the banks do.”
He, however, said it was unfair competition where the telecoms provider Econet was charging FBC $0,35 cents per transaction through their product Mobile Moola, while charging $0,5 cents to Steward Bank.
“It’s not competing when Econet charges 35 cents for Mobile Moola and 5 cents for their other brother (Steward Bank),” he said.
“As banks, we are not afraid of these mobile operators, as banks we can also do that, but we concentrate on cost per transaction.”
Mushayavanhu added that the person who has money has bank accounts and at a point when they need to send money to their parents in the rural areas then they transact through mobile operators.
FBC Holding recorded a 17% decline in after tax profit to $8 million for the half year ended June 30 2014 due to losses in subsidiary Turnall Holdings.
The group intends to dispose of the loss-making entity.
In the period under review, the group recorded an 11% increase in income to $40,9 million as compared to $36,8 million in 2013.
Net interest income increased to $15,9 million during the period under review while administrative expenses increased to $24,6 million from $21,7 million in 2013.
FBC Bank’s contribution to the group revenue grew 5% to $4,3 million, while the building society’s contribution grew 5% to $3,3 million. Microplan Financial Services’ contribution jumped 179% to $1,5 million.