COVID19News

Informal traders take Govt to task over COVID-19 funds

By Albert Nxumalo

Informal traders operating under the banner of the Informal Economy Agenda Task Force have strongly voiced out against the disbursement of Cushioning Fund cash transfers to vulnerable groups by the Government through NetOne claiming that a vast majority of prospective beneficiaries risk losing out as they subscribe to rival Econet Wireless.

NetOne operates One Money while Econet administers Ecocash money transfer platform.

About $600 million has been set aside by Government and various partners for cash transfers to vulnerable groups that include informal traders to cushion them against socio-economic effects emanating from COVID-19.

Each beneficiary is expected to receive ZWL$200.

With banks also observing the mandatory 21-day lockdown restrictions, recipients of the funds will only access the money through mobile transfers.

President Emmerson Mnangagwa announced a 21-day lockdown beginning March 30 as a precautionary measure to forestall the spread of COVID-19 leading to the closure of businesses not classified as essential.

The lockdown has been viewed as a death knell to the country’s economy.

However, it has since emerged that Government has handpicked NetOne, a state-owned company which handled 1.1% of the total mobile money transactions in 2019, while Econet processed 98%, to run the facility.

This means that Econet and Telecel subscribers both private firms have to migrate to NetOne and register under One Money and this is seen as attempts by Government to prop up NetOne’s subscriber base.

The first disbursement is planned to reach 450 000 people, a significant number of customers for any business.

The move has been condemned by informal traders who described it as ” illogical” and “will shortchange a lot of vendors and informal traders”.

“We unequivocally reject this move because it will short change a lot of vendors and informal traders, based on available statistics that the majority of our members use the Ecocash mobile facility,” said the informal traders on Sunday in a statement.

“It boggles the mind why funds donated by development partners are being channelled to one money mobile transfer agent at the expense of other transfer agents like Telecash and Ecocash”.

According to the organisation, the directive raises eyebrows on the sincerity of Government to urgently assist all vulnerable groups including vendors and informal traders in the earliest convenience. 

 “We strongly call upon development partners who made these contributions to urgently step in and advise the ministry that their strategy will hurt ordinary men and women who are not subscribers to the government preferred Netone- One Money mobile transfer agent”.

The organisation said it is common knowledge that many people use Ecocash in Zimbabwe and that the One Wallet mobile in inaccessible to some rural communities.

Last week, a cross-section of women in informal cross border business told CITE that with the lockdown their incomes have been affected and appealed to the Government to avail funds to assist women in cross border business.

The informal traders’ association also claimed that when the local authorities communicated with informal traders associations about the proposed World Bank cushioning fund facility it was not mentioned: “that the facility will only support those registered with the One Money mobile Transfer”.

“We are ready to provide empirical data to show that majority of our members are subscribed to the Ecocash money mobile transfer facility,” the organisation vowed and urged Government not to inconvenience the vulnerable at this already difficult period.

The global COVID-19 epidemic has inadvertently dragged Econet and NetOne in a trade tiff over potential new subscribers.

However, defending the NetOne route to disburse the funds, Women Affairs, Small to Medium Enterprises and Community Development Minister Sithembiso Nyoni is quoted saying “Econet is very expensive and NetOne charges are very low”.

To that end, the informal traders seemed to agree with Nyoni saying “we also call upon Ecocash to be considerate at this difficult period and reduce their tariffs to ensure that vulnerable groups have disposable incomes from this cushioning facility”. 

Nyoni said prospective beneficiaries should not be bogged down by switching over to NetOne as “it is not very difficult to register… just a dollar to get a NetOne line”.

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