The company has also simplified the cost structure, saving customers the inconvenience of having to calculate what it will cost before making a transaction.
The tariff cut is likely to see a sharp rise in the usage of EcoCash, and also drive a boom in the number of users, who are already above two million.
Econet Services chief executive officer Darlington Mandivenga explained that EcoCash had responded to customer requests by removing the percentage system, replacing it with much simpler bands that make it easier for customers to know exactly how much each transaction will cost.
“If you send US$10, for instance, it now costs you 19 cents, whereas sending US$500 costs you only US$4,49 down from US$6,00. A transaction of a dollar or less is completely free,” Mandivenga explained. Cash in and registration is also free.
EcoCash is fast becoming the most preferred method of payment in Zimbabwe.
A comparison between EcoCash and alternative money transfer systems shows that EcoCash is up to 50% cheaper than the cheapest available option, and 233 percent cheaper than the most expensive option on the market. Alternative options currently available include Textacash, ATMs, credit and debit cards issued by banks.
Econet even compared its service with those of Western Money Union and Moneygram, which are by far the most expensive. For example, sending US$150 locally would cost US$5 with Western Union against only US$2,45 with EcoCash.
For most other options available the charges include a minimum fee plus a percentage of the amount to be sent which makes it expensive for the lower band transactions and complex for the customers. For example, if one is to send US$5 using EcoCash they are charged only 9 cents while TextaCash charges 25 cents and other banks charge as high as a dollar. For sending US$500, EcoCash charges US$4,49 while TextaCash charges US$5,20 and some banks will charge as high as US$6.
To make sure cash reaches all corners of the country, EcoCash uses over 3000 agents, who are mostly local shops and stores. These agents are paid commissions, which are raised from the fees charged for using EcoCash.
Most of the country's banks are also now part of this wide EcoCash ecosystem, which also includes large supermarket chains and Zimpost, the largest agent in terms of number of branches.
“Access and convenience for the recipient is the key to this service. Why should your mother have to get on a bus to find the branch of a bank or building society in the nearest town? There is no match for our agent network of 3000 outlets. That network is growing at a rate of 500 agents per month,” Econet CEO Mr Douglas Mboweni said.
The new tariff regime is expected to accelerate growth of a service that already processes more than a two million transactions per week, valued at more than US$35 million.
Econet spent more than US$50 million developing EcoCash, which uses a system that is connected to its network and was custom designed for its special needs.
Econet said the most important factor when one sends money to someone in remote areas of the country is how easily they recipient can actually access the cash.
EcoCash is the safest, simplest, fastest and cheapest way to send and receive money, and has by far the widest national coverage.Post published in: Business