Econet Wireless’s mobile money offering, EcoCash, is new to the mobile money scene but already making a splash. In its first 14 months of operation, EcoCash has raced to over 2 million users earning it a place amongst the world’s 14 mobile money sprinters. MMU sat down with CEO of Econet Services, Darlington Mandivenga, to discuss Econet’s unusually strong commitment to mobile money and the strategic reasons for investing in the program.
Why EcoCash?
In this first clip, Mr. Mandivenga describes EcoCash as a “strategic response to a strategic challenge.” Econet is diversifying out of the core telecom business, where ARPUs are under pressure and putting serious investment in “overlay” services such as mobile money.
Why is EcoCash being built as a separate entity from the core telecom business?
Econet Services (which houses EcoCash) has been set up as a separate company entirely from Econet Wireless (which houses the traditional telecom business), with its own resourcing and governance. Given the size of the opportunity that Econet sees in mobile money, Mr. Mandivenga describes how this structure helps to ensure the right level of focus on mobile money within the overall business, has been a critical success factor for EcoCash.
How far has EcoCash come since launching 14 months ago?
Mr Mandivenga shares the figures for EcoCash’s first 14 months of operation: Over 2 million subscribers and 7 million transactions ($150 million in value) per month. Econet believes these figures will grow with the introduction of new use cases, in particular merchant payments.
What level of investment has Econet made in EcoCash?
EcoCash’s rapid customer acquisition is driven by a high level of investment in customer acquisition and building the distribution channel. EcoCash is giving away 80% of their revenue to the agent network in the form of commissions to help build a robust and accessible channel. Asked whether such remarkable growth would have been possible without Econet’s level of investment in the program, Mr. Mandivenga responds emphatically: “That’s a big no.”
How is relationship with Zimbabwe central bank?
Mobile money is an important contributor to the Zimbabwean central bank’s (RBZ’s) financial inclusion goals. Here Mr. Mandivenga describes how the RBZ has created an open, collaborative dialogue with Econet and calls for their continued support as they innovate and introduce new services.
What are Econet’s ambitions for EcoCash?
Econet is an ambitious mobile money provider. Mr. Mandivenga’s ambition for mobile money goes way beyond P2P transfers – he wants EcoCash to be the “dominant payment system” in Zimbabwe and Zimbabwe to be the “most cashless society in Africa.” He alludes to the “change problem” in Zimbabwe, where since the dollarization of the economy coins are in short supply and retailers are unable to provide change to shoppers. Might mobile money solve the change problem?
Advice for other C-Level executives on mobile money?
Mr. Mandivenga advises that CEOs need to take the long-term view and understand why they are in the mobile money business and what they hope to achieve.
Congratulations to the EcoCash team for bringing an exciting new service and such energy to the mobile money industry. Expect to hear more about EcoCash from MMU soon.