BY TATIRA ZWINOIRA
MOBILE money cash in transactions rose 11,5% to $1,17 billion in the first quarter of 2019 from $1,05 billion in the previous quarter as the country’s cash woes continued.
“There was growth in Cash-In transactions as well as airtime, bill and merchant payments in the quarter under review,” reads part of the Postal Telecommunications Regulatory Authority of Zimbabwe (Potraz)’s 2019 first quarter report.
“Ecocash processed 99,4% of the total value of transactions whereas Telecash and OneMoney processed 0,1% and 0,5% respectively.”
The EcoCash platform is run by Econet Wireless.
“Mobile money services are expected to continue playing a key role of bridging the financial divide by providing safe, secure and cheap financial services in areas where many Zimbabweans have no access to formal banking systems. 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.”
Potraz also says Zimbabwe’s telecommunications sector recorded a 13% decline in revenue to $249,88 million in the first quarter of 2019 to $287,03 million in the comparative period of last year as costs in the sector increased eating into income.
In the quarterly report Potraz revealed that costs increased 6,4% to $185,9 million in the period under review from 2018’s fourth quarter of $174,78 million.
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“An overall decline in mobile revenues vis-à-vis a growth in operating costs was recorded in the quarter. All the mobile operators recorded a decline in revenues with Econet recording the biggest decline of 15%. The decline in mobile revenue is attributable to the decline in voice traffic and revenue thereof, which still accounts for 59,3% of total mobile operator revenues,” Potraz said.
There was also a decline of 4% in mobile voice traffic from 1,467 billion in the 2018 fourth quarter to 1,404 billion minutes in the 2019 first quarter.
“The mobile operators recorded an overall decline in capital expenditure in the quarter under review. Capital expenditure declined by 22,1% to record $22 978 234 from $29 501 279.”
In terms of internet/data usage there was a substantial increase in mobile internet/data usage of 19,2% to 10,202TB in the quarter under review from 8,559TB recorded in the previous quarter.
Of concern was the marked decline of 9,8% in the mobile penetration rate from 93,1% in the 2018 fourth quarter to 83,3% in the first quarter of 2019 owing to the increased cost in purchasing cellphones.
“The performance of the industry will be dependent on the general economic environment. Telecommunications operators are also expected to focus more heavily on customer retention and churn in the face of dwindling revenues from traditional services and rising operating costs. Cutting costs will remain crucial for many operators to maintain viability in the current inflationary operating environment,” Potraz said.
However, while cash-ins improved, Potraz said there was a decline in the value of cash-out, cross network transactions as well as the total number of transactions.
Cash-outs dropped by 5% to $795,45 million in the first quarter of 2019 from a previous amount of $837,76 million recorded in the previous quarter. This indicated continued cash shortages in the market.
There was an overall growth in active mobile money subscriptions across all operators of 5,2% in the period under review to 6 679 833 from 2018’s fourth quarter figure of 6 352 552.