Zimbabwe: Econet Reignites Telecel Hostility


FEB 18,2014.


ECONET Wireless has reignited its protracted hostility with fierce rival Telecel Zimbabwe after barring its agents from doubling up as agents for rival mobile money transfer service, telecash. This follows the launch by Telecel last week of its own mobile money transfer service, telecash, which will compete directly with Econet’s Ecocash. Telecel said it had no problem with agents doubling up for competition provided they saw value in doing so. The Herald Business understands that Ecocash agents were made to sign exclusivity agreements by Econet against their will.

Telecel initially took its exception to Postal and Telecommunications Regulatory Authority of Zimbabwe who advised it to approach the Reserve Bank as regulator for financial services.

Potraz acting director general Mr Alfred Marisa yesterday confirmed receiving the complaints from Telecel, but said the authority advised them to approach mobile financial service regulator, RBZ.

“Mobile financial services are regulated by the Reserve Bank. While they contacted us and said there is that problem, we referred them to the RBZ, we are not the responsible authority,” he said.

Contacted for comment, Telecel confirmed lodging its reservations with the telecoms regulator who referred it to the central bank.
“We confirm that we sent correspondence to Potraz and they referred us back to RBZ. We shared with RBZ our concerns and they are currently doing their own investigations and we are await their feedback,” said Telecel public relations manager Mr Francis Chimanda.

The country’s second biggest telecommunications operator – with 2,5 million active subscribers – after Econet Wireless (8,5 million), said it will not “comment further until it has received feedback”.

While no comment could be obtained from RBZ, Econet said it was happy with the growth of Ecocash and acknowledged the presence of other players in the market.


“Econet Wireless is pleased with the growth of EcoCash, and has always acknowledged the presence of other players in the market. This has always been the position, as communicated to our regulators. Econet has thrived in a competitive environment,” said Econet corporate communications manager Mr Ranga Mberi.

An Ecocash agent in the CBD interviewed by this paper said the move was unfair on agents as they wanted to maximise their revenue streams.

“It makes sense for agents to service all mobile money networks using the same overheads of rent and employees. Therefore it follows that an agent  should represent telecash, Mobile Moola, Texta Cash, Zippit , One Wallet and in the process get money from each,” said the agent.

Another agent said; “I think it’s a violation of our rights. We are in business to earn a living not to be slaves of Econet.”
The latest episode marks yet another chapter in a short period that Econet has been involved in bruising battle for supremacy with Telecel.

Last year, Econet disconnected Telecel, making it difficult for the latter’s subscribers to make calls into its domineering “big brother’s network” over allegations that Telecel did not hold a valid licence. However, the real origins of the wrangle was when Telecel effected massive discount on calls for its customers, which analysts said made Econet feel threatened by the possibility of losing customers at a time its voice call revenue appeared to be tapering off.

Econet is also involved in a war with banks over the opening of the USSD gateway. The banking industry has been fighting a raging battle with Econet to open up access to its USSD gateway which supports SMS mobile banking products such as money transfers.

However, Econet has brushed aside bankers’ requests for a revision of its one-sided agreement that is tilted unfavourably in Econet’s favour. Econet insists that there will be no wholesale revision of the agreement but the telephony services company says “it is willing to talk to individual banks”

Sources close to the failed discussion between Econet and the banks told The Herald Business that the issue has now been referred to the reserve bank of Zimbabwe.

“Last week, the Bankers sent a detailed communication to the most senior office of the RBZ to sensitise them on the intransigence of the mobile network operator in question,” a senior banking official who requested anonymity said.

“The issue is clearly now for the RBZ, Potraz and perhaps the Competition and Tariffs commission to handle and things are certainly as well as they should be in the mobile banking space.” he said. Herald