During the weekend we were startled to receive a message from Hot Recharge telling us that Econet was now deliberately limiting the amount of Zimbabwean dollar airtime it was selling. According to Hot Recharge hey are no longer accepting payments of more than 100 000 ZWL per day for Econet airtime. For now the issue appears to be Econet only as according to Hot Recharge other networks do not appear to be affected. However, recent experience shows that NetOne customers have also been having issues when it comes to buying ZWL data bundles.

Below is the message we received from Hot Recharge:

Econet has advised they will be limiting ZWD [probably meant to say ZWL here as ZWD is long dead] airtime. Therefore we cannot accept payments more than 100k/day for Econet airtime. Other networks are not affected

The message from Hot Recharge

On the hunt for the elusive USD

It is not a secret that mobile network operators in Zimbabwe have been struggling when it comes to providing quality service. There has been a marked increase in the number of complaints about poor network speeds, erratic network behaviour and disappearing airtime on social media. Econet which is arguably the best network has also struggled with these issues too. These failures have always been blamed on foreign currency shortages there is a good reason for that. Companies like Econet are built using high-tech equipment that needs to be purchased using foreign currency, parts for the same equipment need to be bought using foreign currency, specialists who service the equipment get paid in forex, licence fees are paid in foreign currency and internet connectivity requires foreign currency. In addition to this Econet has to pay its engineers in foreign currency or risk losing them to greener pastures in other countries. For example, South African telecoms have made it a habit to headhunt Zimbabwean talent at the expense of local companies.

On the other hand, you have POTRAZ which has made it hard for mobile network operators to raise their tariffs quickly enough to respond to spikes in black market rates. The government has also made it a point to make sure that the so-called “official rate” is used when it comes to setting prices for data and calls. This is despite the fact that mobile network operators do not appear to be big beneficiaries of the foreign currency auction. The end result is that operators like Econet have struggled to raise the foreign currency they need to make sure things run smoothly. They have resorted to prioritising certain areas and the result has been a noticeable decline in service. Limiting ZWL airtime sales while promoting low-priced USD bundles might be their way of trying to shore up their low reserves but it is risky.

A risky strategy

The thing is a lot of Zimbabweans still earn ZWL. This list includes Zimbabwe’s largest employed group of people-civil servants. The government has resisted the idea of paying civil servants exclusively in USD and even when they do they do so in electronic or Nostro USD instead of cash. Econet and the other mobile network operators have not yet come up with a smooth way that allows customers to use USD in their accounts to buy airtime. Right now at the moment Ecocash mainly requires you to use Ecocash USD wallets where you have to cash in using cash or through a remittence from the diaspora. A lot of people do not have access to these methods yet. It also doesn’t help that Ecocash is now operating without its powerful agent network of yesteryears which made it a formidable omnipresent service.

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