By Shariffah Pateya
This week, I will be giving you an update on how Zimbabweans are responding to bond notes. In particular, my view that EcoCash in its current form will not exist by the end of 2017.
1. A friend has noticed that in his shop, customers have stopped paying with USD. Instead, they are using bond notes or swiping cards (Some cards do not belong to the buyer). In mid December, I observed this when I was in one of the big supermarkets in Mutare: At least 5 young ladies who were loitering inside the shop were offering to swipe their cards if I gave them my US dollars.
2. Similarly, Zimbabweans are depositing bond notes into EcoCash and keeping USD at home. Therefore, the balances in the EcoCash are becoming predominantly bond balances.
3. Share prices on the ZSE are going up by around 30% since 1 November. “Stable shares” such as Old Mutual, Delta, OKzim, FML, NICOZ are favorites. Local buyers are speculatively pilling up on shares using electronic channels (Bond notes).
4. People in Zimbabwe are arranging for those in the Diaspora to buy items such as TVs, phones, DSTV, cars for them. They then pay in Zimbabwe through EcoCash.
5.Online grocery stores that deliver in Zimbabwe have started mushrooming. Therefore, diaspora money is staying in the diaspora. Soon, these services shall include furniture, clothing etc.
The full impact of bond notes will be felt when the $5 bond note is introduced and the civil servants bonuses are paid. There will then be a noticeable deterioration with price increases, devaluation and food shortages.
When the situation deteriorates, EcoCash will be forced to create seperate USD, Euro, Pula and Metical wallets, in addition to the current Rand Wallet. The result is that people will start to exclusively transact in these good wallets and only use the bond wallet for speculation, paying utilities and government bills.
I predict that at this point, EcoCash will either be banned by government or their services will be subject to even more regulation.