Zimbabwe’s central bank, which is battling to contain exchange rate distortions that are driving inflation, has shut down the country’s popular mobile money transfer service, InnBucks for not having a permit.
InnBucks, run by fast food franchise operator Simbisa, is a mobile platform that leverages USSD and mobile application tech to allow consumers to send and receive money, as well as purchase from fast food outlets.
The mobile money service has gained popularity as a means of storing and sending US dollar funds across the country.
However, the Reserve Bank of Zimbabwe (RBZ) says it has to cease operations and the closure has been announced a week after the EcoCash mobile money platform – run by telco, Econet Wireless – received approvals to allow cash-in and cash-out of foreign currencies.
“The Reserve Bank of Zimbabwe (the Bank) advises the public that it has ordered Simbisa Brands (Private) Ltd to cease operating the money transfer service branded or styled InnBucks, with immediate effect,” stated Zimbabwean central bank governor, John Mangudya on Wednesday night.
Mangudya explained that the RBZ had directed InnBucks “to apply for- and obtain necessary approvals in order to continue offering the service” in November 2021.
The RBZ is the monetary authority in Zimbabwe and has been tightening the screws on mobile money operators, at one time blaming EcoCash for inflaming parallel market exchange rates.
“To date, the company (Simbisa) has not yet regularised the service as directed, hence the inevitable regulatory intervention by the Bank. The cessation of the service means that customers shall no longer be able to deposit funds into the InnBucks account or transfer the funds to third parties,” added Mangudya.
With a large and growing customer base, InnBucks is offering a service that has not been available because of delays in approvals for telco-run mobile money operators to offer foreign currency mobile money transfer services. Many currently rely on traditional money transfer companies as well as banks, who charge high levies.
RBZ has offered users some respite and said: “Customers may redeem their balances for cash or goods at Simbisa Brands (Private) Ltd outlets within a period of 30 days” from yesterday.
InnBucks and Simbisa released a statement which reads: “(the companies) remains engaged with the regulator in respect of its license” issues. Regrettably an impasse has occurred in respect of which the Simbisa Board is engaging the regulator with a view of achieving a speedy and amicable resolution.”