Mobile banking service providers are now required to credit interest monthly to their customers’ balances following the enactment of new banking regulations on Friday.
There are three companies providing banking services in Zimbabwe namely; Econet (Ecocash), NetOne (One money) and Telecel (Telecash) with the former commanding the largest market share.
Following conventional banks’ failure to fully cater for banking services for majority of Zimbabweans, some mobile network providers came up with several innovative products to cater for the unbanked market.
The services were well received as businesses and the general public found them as convenient means of transacting.
However, there has been concern that mobile money deposits have been subject to massive loss of value due to transaction charges as well as premiums attached when one intends to access cash from the mobile money platforms such as EcoCash, TeleCash and OneMoney.
Finance and Economic Development Minister Mthuli Ncube, last Friday announced measures through the Government to stop such practices.
"It is hereby notified that the Minister of Finance and Economic Development has, in terms of Section 81 of the Banking Act (Chapter 24: Section 20) as read with Section 31 of that Act and with the approval of the Reserve Bank of Zimbabwe as required by subsection 5 of that section made the following regulations.
"Every mobile banking service provider shall credit interest due in terms of these regulations on a monthly basis proportionately to each customer’s daily closing balance during each month," reads the Gazette.
The Minister said these regulations may be cited as the Banking (Savings Interest Rates) Regulations, 2020. 2. In these regulations — "mobile banking trust account" means an account with a banking institution in which a pool of deposits is held on behalf of customers of a mobile banking service provider.
(1) From the publication of these regulations every banking institution shall — (a) on call, demand and savings deposits and mobile banking trust accounts (the interest on which latter accounts will be credited in accordance with subsection (2) to the customers of the mobile banking service provider by that provider), with a tenor greater than one day but less than thirty days pay interest at a rate of no less than a rate equivalent to fifty per centum of the prevailing Treasury Bill yield on Treasury Bills of equivalent tenor as published from time to time by the Reserve Bank; or (b) on savings and fixed deposits and mobile banking trust account […]