President ED – State had to act against EcoCash because $8.4 billion was circulating outside the banking system

President Mnangagwa recently addressed a ZANU-PF Committee in Gweru and in that address he spoke on the long-running feud between EcoCash and the state.

The President had some interesting things to say about the mobile money operator which has been accused by the financial regulator and state officials of being behind runaway inflation.

We realised that Ecocash was behind all this so we studied this thing and got to their server and found everything, every corruption and takatora tsvimbo ndokurova, it was painful to others but we said we only allow limited mobile money and it must reflect in the account.

President ED said that there was $8.4 billion circulating outside of the banking system which they only discovered after investigating:

We were all confused as to what was happening until we set up a committee and we discovered there was up to $8,4 billion circulating outside the banking system, which money in financial terms, is phantom money, which is some sort of ghost money whose source no one knows.

Nothing new here
The President’s comments just recall what the regulator (RBZ) has said about EcoCash and mobile money operators before. RBZ claimed that mobile money operators were actually creating money which isn’t backed by balances in their trust accounts.

Because of the weak KYC of mobile money platforms, the regulator suggests that many account holders were using “ficticious and unverified” identification particulars. This in turn makes it extremely difficult to find out who is behind money laundering.

The result of this has been new regulation that has limited the use of mobile money. Revised monthly and daily limits were introduced and a limit has been placed on the number of mobile money accounts one can have.-techzim