In their urgent application to the High Court seeking interim relief from the order by the RBZ which banned cash-in and cashout, Ecocash, represented by their parent company Cassava Smartech Zimbabwe Limited (Cassava), they have said that they might need to temporarily switch the entire Ecocash system to see through the RBZ’s directive.
Yesterday the RBZ dealt a potentially lethal blow to the mobile money industry by banning cashout and cashin transactions which are at the very core of mobile money. Ecocash, by far the largest operator with close to 99% of the market has since launched an urgent appeal at the Hight Court.
The crux of Ecocash’s multi-pronged attack
To highlight the urgency of the matter Ecocash cites the volumes of payments that they process in terms of cashout and cash in alone:
- 10 562 070 people are on the Ecocash platform with about 6 400 000 of them having used Ecocash in the last 90 days alone
- Of these 6 337 242 are rural while 4 224 828 are urban
- Over 7 billion has been cashed in and over 4 billion cashed out ever since the Zimbabwean dollar was introduced
Ecocash argues the order by the RBZ is ultra vires since the Ecocash system which the RBZ is acting against is not at fault. Rather the RBZ’s complaint is against the acts of some of the customers who use Ecocash. So it’s not reasonable for the RBZ to suspend the entire system based on these bad apples. They also argue that the shutdown is against the constitution as it constitutes a deprivation of property.
To highlight the folly of the authorities and the unreasonableness of the order, Ecocash goes on to point out how millions of innocent customers and Ecocash itself were being unfairly punished for no reason just so the RBZ can stop some alleged foreign currency traders.
The order should have been like the one given to banks not wholesale
Another complaint is that Ecocash is just a wallet and actually relies on banks. Banks have also been used by alleged foreign currency dealers. Instead of collective punishement surgical directives were issued. Ecocash expresses shock and dismay at being ordered to shut the entire system.