Econet Wireless Zimbabwe Expands into FinTech with EcoCash Acquisition
In a strategic bid to unlock value for stakeholders, Econet Wireless Zimbabwe Limited has acquired the financial technology (FinTech) businesses from EcoCash Holdings Zimbabwe Limited. The administrative integration process of these businesses is currently in progress and expected to be completed by the second quarter. This integration will result in significant synergies, streamlining processes and propelling the business forward.
Post-integration, Econet’s primary focus areas will be mobile money, digital platforms, InsurTech, HealthTech, and mobile communications. The acquisition excludes Steward Bank, and the financial results of these FinTech businesses are now consolidated as subsidiaries of Econet Wireless Zimbabwe Limited Group, reported under the financial technology segment.
Zimbabwe introduced a new currency, Zimbabwe Gold (ZWG), on April 5, 2024, replacing the Zimbabwean dollar. Backed by precious metals and foreign currency reserves, this new currency aims to stabilize the economy.
Econet Wireless is prioritizing network modernization to stay ahead in the rapidly evolving industry, focusing on 5G and IoT technologies. Over 30 new sites were commissioned across the country, enhancing network performance and quality of service. The modernization program will continue, covering urban, peri-urban, and rural areas, with plans to commission additional 5G sites by the end of the financial year.
The company is also investing in renewable energy sources like solar power to mitigate the impact of load shedding on the national power grid. For the quarter, data and voice usage grew by 74% and 46%, respectively, relative to the previous year, highlighting the need for sustained network expansion.
The FinTech segment, anchored by the mobile money business, delivered strong performance driven by growth in the active customer base and increased usage of digital financial services. Active customers grew by 189% compared to the first quarter of the prior year, and international remittance values increased by 265%.
The synergies between digital insurance platforms and the mobile money ecosystem are driving increased adoption and cross-selling opportunities. The life insurance business saw a 14.2% growth in premiums, and the EcoSure Airtime Cover subscription reached over 400,000. The short-term insurance business, Moovah, introduced mobile phone insurance, reinforcing Econet’s commitment to innovation.
Econet declared and paid an interim dividend of 0.26 US cents per share for the quarter ended May 31, 2024. Looking ahead, the increasing demand for data and digital services will continue to reshape mobile network operations and capital investments. The reintegration of the FinTech businesses is expected to drive innovation, enabling Econet to meet the evolving needs of its customers.
