NetOne is the second-largest mobile network operator (MNO) in Zimbabwe. It has been actively bent on stepping up its operations especially since last year. It has been rolling out several initiatives aimed at increasing its subscriber base and market share amongst others. They have particularly been doing a lot on the mobile money front. Last year we saw them introducing the zero charges promotion for their One Money transactions. We have also seen them carrying out promotions involving school fees payments through One Money. All in all, they have done and are still doing remarkable work in stepping up their operations.
Second-Placed But Afar Off
NetOne might be the second biggest MNO in Zimbabwe but their subscriber base and market share are still tiny. Especially in comparison to Econet, they have lots of ground to cover to catch up. For instance, One Money commands only just a single per cent of the local mobile money market. To show you how tiny that is you might want to note that it is virtually the case that a One Money subscriber is also an EcoCash subscriber. Comparatively, EcoCash accounts for more than 98 per cent of the local mobile money market.
Government To Issue COVID-19 Social Grants
The Government has put together a grants initiative where vulnerable individuals will receive pay-outs. We are in the final days of the 21-day long lockdown that was enacted recently. This lockdown which does have its upsides has also had numerous and far-reaching negative implications. The local economy entails a vast majority who earn a living informally. Given the stipulations of the lockdown, it is those informal sector players that have been hardest hit.
To offer some form of relief to affected families the government has decided to come up with this initiative. An eligible individual will be getting ZWL$200 which is the equivalent of US$8. This initiative has provided a great opportunity for NetOne to gain some more mobile money subscribers. No doubt it is going to be a highly contentious issue especially in light of how NetOne is generally considered to be a government-owned MNO.
The issuing of the grants is imminent with ZWL$90 million scheduled to be paid out this week. This would mean that 450 000 vulnerable individuals will benefit. Let me also clarify that it is per individual not per family i.e. the pay-outs. Thus, it will be possible for several individuals from a vulnerable family to each receive ZWL$200 each.
Pay-Outs To Be Done Through One Money
It has emerged that those who will be earmarked to receive the grants will receive them through One Money. Government officials have indicated that when someone gets registered for the grants scheme they will get a NetOne line. On top of that, they will receive a bank card that they will be able to use to make payments through the ZimSwitch platform. It has been highlighted that the government has partnered with NetOne in rolling out this initiative. Why NetOne you might ask?
Well, the government has justified their rationale by saying that transaction charges for EcoCash are too steep. It would be to the best interest of the beneficiaries that they manage to maximise on the money they will receive. Logically, that is a straight line of thinking to say let us use a platform whose transaction charges are reasonable. So let it be known that to receive these grants once you are eligible you will need to be on the One Money platform.
Implications For NetOne
This will all translate into more One Money sign-ups. Earlier I mentioned that an initial 450 000 people will receive pay-outs this week. However, this only because ZWL$90 million is what is immediately available at the moment. It is hoped that more funds will be made available. Ultimately, as many as 4 million people will receive these pay-outs. Looking at how these pay-outs will solely be made through One Money that means One Money’s subscriber base will be significantly enhanced.
I am not going to dwell on the sensitive nature of government settling for One Money. Most people would feel that there is unfair bias and so on. However, on the flip side, it is not as favourable for the EcoCash platform to be used – too many functionality issues and the transaction charges are too high anyway. There are also concerns regarding how fair or not the selection process of the beneficiaries will be. Overall, it is somewhat refreshing to know that some people will get some relief.