Chronicle Editor
Despite perceptions in some quarters that EcoCash’s charges are comparatively high, a closer examination by independent industry experts reveals that such perceptions are unfounded and not backed by the facts.
Financial analysts said EcoCash’s charges are in line with industry standards and heavily impacted by the Government IMT Tax, which contributes the greatest cost component of the mobile money service’s charges to the end user.
According to fintech and financial expert Ngoni Dzirutwe, the perception that EcoCash charges are high is primarily due to misinformation and a lack of understanding of the tariff cost structure for mobile money in Zimbabwe.
“When you look at the fee structures across the board, EcoCash is competitively priced. The differences, if any, are often tied to specific service offerings or transaction types,” Dzirutwe explained.
EcoCash customers incur a 1,3 percent fee for sending money, and a 1,7 percent cash-out charge — rates that align closely with industry standards. Competitors such as OneMoney, Inn Bucks, Omari and Mukuru charge similar fees, ranging between 3 percent and 4 percent. These charges along the mandatory 2 percent government tax (the Intermediated Money Transfer Tax, or IMTT) imposed by the government, are consistent across all mobile money services on each transaction.
However, these transaction fees may vary from time to time when providers run promotional campaigns aimed at boosting usage.
To further financial inclusion and the shift towards a cashless society, several industry players, including the Zimbabwe National Chamber of Commerce, have consistently advocated for a reduction in the IMTT from 2 percent to 1 percent or its complete removal.
“The IMTT should be lowered from 2 percent to 1 percent, a measure which is expected to promote the use of electronic money in line with the central bank’s goal,” the ZNCC recently argued in a submission to Parliament.
ZNCC noted that IMTT has disproportionately burdened formal businesses, which also bear this levy when paying taxes to the Zimbabwe Revenue Authority.
“The IMTT exerted pressure on the already overtaxed formal businesses. If this step is to be taken, the IMTT should be removed altogether with the withdrawal levy and deposit fees including on high-cost bank accounts,” added the industry body.
Meanwhile, financial consultant Mary Ndlovu suggested that the misconceptions about EcoCash’s pricing might stem from its market dominance.
“When a company holds a significant market share, it naturally becomes more visible, and any charges associated with its services are scrutinised more closely,” Ndlovu notes.
“This scrutiny can lead to the perception that charges are higher when, in reality, they are on par with industry norms.”
Ndlovu further explained that consumers often overlook the comprehensive services offered by EcoCash.
“EcoCash is not just about sending money. It’s an ecosystem that includes bill payments, savings products, insurance, and more. The breadth of services can sometimes make it seem like the charges are more, but when you break it down, the costs are justified by the value provided,” she said.
Economic analyst Macdonald Ndovi argues that comparing charges without considering the full value proposition can be misleading.
“EcoCash offers extensive coverage, reliability, and a wide range of services that make it more than just a basic mobile wallet. The slight variations in charges, if any, are a reflection of the additional value customers receive,” Ndovi asserted. — businessweekly
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