Fun

Zimbabwe’s Mobile Money on Life Support as Central Bank Tightens Screws: Restrictions to Affect P2P Bitcoin Trading

News Feed - 2020-08-28 07:08:06

Zimbabwe’s Mobile Money on Life Support as Central Bank Tightens Screws: Restrictions to Affect P2P Bitcoin Trading


Zimbabwe’s Mobile Money Operators (MMO) say they will comply with the latest directive by the central bank to shutdown mobile money agents. In addition, the MMOs will also limit mobile money transactions to $50 (Zwl $5,000) per day while users are now restricted to one mobile money account per person. The directive went into effect right after the monetary policy review by the Reserve Bank of Zimbabwe (RBZ) on August 21.


In a sign that MNOs have lost an appetite to fight the RBZ, the mobile money market leader, Ecocash also said funds in “frozen agent accounts will only be liquidated into the affected agent’s formal bank account.” On top of that, the liquidation will “require RBZ approval on a case by case basis.”


Ecocash has previously sought relief against RBZ directives through national courts. However, following changes to the regulations that govern MNOs in July, the RBZ now has an upper hand in its long-running battle against Ecocash.


Nevertheless, while the RBZ appears to be winning, some believe the new restrictions to affect business activity. Others are even predicting that this will hasten re-dollarisation of the Zimbabwean economy. Zimbabwe abandoned dollarisation in late 2016 when it reintroduced local currency, the Zimbabwe dollar (Zwl).


However, after years of economic decline and cash shortages, Zimbabweans are increasingly resorting to the US dollar again as a means of settling domestic transactions. The shutting down of mobile money agents will likely see an increase in demand and usage of the greenback and alternatives like bitcoin.


Meanwhile, mobile money users are reacting to news of the directive by asking the MMOs how they will deal with cases of multiple accounts holders. Some mobile money users have more than one account registered in their name. The other accounts are usually given to minors or relatives who cannot have their own because they lack an identity document.


Frustrated with the RBZ decision, some users went on Twitter to vent their anger. One user named Pola Polite said of the decision:


“Its always the grass that suffers, so if my mother who stays in the countryside falls sick, it means I will need 5 days of sending money for her to survive!”


Another user, Shefu Tendai said: “So this means that if my grocery is Zwl $15000 per month I will need to go to the shop 3 times. Well, my bill is 10k that means I will need to make the payments in 3 days and then do not make any other payments. [Reserve Bank of Zimbabwe] please review payment to merchants amount.”


However, other users also blame Ecocash for inviting the RBZ’s latest directive. One user, Lee Ann Benard tells Ecocash: “was about time you stabilise the system and put a stop to unscrupulous dealing by greedy people. Mobile money should be linked to one’s bank account ridiculous buying your own currency at a percentage. Great move.”




Meanwhile, the latest directive by the RBZ and the apparent compliance by MMOs will likely affect bitcoin traders that still accept mobile money as payment. The set daily transaction limit is far below typical daily bitcoin trades.


Additionally, the dumping of mobile money as a payment method means informal bitcoin transactions will have to be conducted in person. However, with movement currently curtailed due to Covid-19 restrictions, many traders will find it hard to trade as well as they did before the new regulations.


In the meantime, peer to peer trading platforms that list Ecocash as a form of payment will now be forced to drop this as a payment option.


What does the latest RBZ directive mean for the future of mobile money? Tell us what you think in the comments section below.Fidelity Digital Assets Quotes Bitcoin Creator Satoshi Nakamoto in Latest Investment ThesisFINTECH | Jul 31, 2020Visa Moving to Integrate With Digital Currency PlatformsFINTECH | Jul 26, 2020Tags in this storyAfrica, Bitcoin, BTC, coronavirus lockdown, COVID-19, dollarisation, Ecocash, medium of exchange, MMO, Mobile money, p2p, Reserve Bank of Zimbabwe, Transaction ceiling, Zimbabwe


Image Credits: Shutterstock, Pixabay, Wiki CommonsPurchase Bitcoin without visiting a cryptocurrency exchange. Buy BTC and BCH here.Show comments

News Feed

XRP Price To Hit $45? Here’s What Happens If It Mimics 2017 And 2021 Rallies
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu
Crypto-Friendly Banking Platform Cashaa Expanding in India, US, Africa
Crypto-Friendly Banking Platform Cashaa Expanding in India, US, AfricaCrypto banking platform Cashaa has unveiled plans to expand its services in India, the U.S., Africa, and the Ca
Bitcoin.com to Give Away $25,000 In “December to Remember”
Bitcoin.com to Give Away $25,000 In “December to Remember” In light of the holiday season, and to celebrate a fantastic year for economic freedom enhancing technologies like Bi
‘Ethereum Killers’ Managed to ‘Kill’ Themselves in 2022 Rather Than Beat the Smart Contract Economy’s Heavyweight Champ
‘Ethereum Killers’ Managed to ‘Kill’ Themselves in 2022 Rather Than Beat the Smart Contract Economy’s Heavyweight Champ At the end of 2021, a myriad of people thought a h
Gareth Jenkinson11 hours agoGrayscale submits SEC filing to convert Ethereum Trust to spot ETFCrypto asset manager Grayscale has filed an application with the U.S. SEC to convert its Ethereum Trust to a spot Ethereum ETF
Arijit Sarkar13 hours agoSwiss wholesale CBDC pilot kicks off in alliance with central, commercial banksThe Swiss wCBDC pilot project will be hosted on SDX and use the infrastructure of Swiss Interbank Clearing.4515 Tota
Highly Anticipated Insured Launchpad, Binstarter to Open to the Public on Aug 4th
Highly Anticipated Insured Launchpad, Binstarter to Open to the Public on Aug 4th press release PRESS RELEASE. Binstarter Protocol; the first and only Insurance P
Bitcoin price shows strength as investors anticipate return of money printing
Marcel Pechman5 hours agoBitcoin price shows strength as investors anticipate return of money printingBitcoin rallies as central bank stimulus packages become more common, and the Fed’s signal of “higher for longer
David Attlee13 hours agoFrance updates its crypto licensing regime to synchronize with MiCAThe amendments will become obligatory starting Jan. 1, 2024, and must be taken into account in by applicants for enhanced DASP re
The Mysterious FTX Debacle, Tim Draper’s BTC Price Prediction, More Support for Ripple in SEC Lawsuit — Week in Review
The Mysterious FTX Debacle, Tim Draper"s BTC Price Prediction, More Support for Ripple in SEC Lawsuit — Week in Review As theories proliferate wildly about the true nature of wha
DDoS Attackers Return With Massive Extortion Campaigns in the Wake of Bitcoin Prices Surging
DDoS Attackers Return With Massive Extortion Campaigns in the Wake of Bitcoin Prices Surging Threat actors have been finding opportunities in bitcoin’s bul
Chinese Miner Claims an Ethereum PoW Fork Is ‘Coming Soon,’ Despite ETC’s Existence
Chinese Miner Claims an Ethereum PoW Fork Is ‘Coming Soon,’ Despite ETC’s Existence According to Chandler Guo, an influential Chinese bitcoin miner, a proof-of-work (PoW) ver