InnBucks: generating “interest” from money in a cashier’s till

InnBucks, Simbisa’s financial services arm, has cut its service fees for transactions from 5% to 3% for amounts over US$5. More importantly, Innbucks is saying that it has set the price for sent amounts under US$5 to 1%.

This second provision is very interesting because it suggests that they have, through data on their end, seen that customers are sending low values at high volumes. Additionally, this could also imply that InnBucks is tired of fighting the other local remittance services in the values category (typically at US$10 minimum) and now wants to play the volumes game.

The only unfortunate thing about all of this is that the 2% Intermediary Money Transfer Tax still applies to these transactions. So in truth, its down from 7% to 5% for sums over US$5 and the send fees for amounts under five bucks might actually be 3% which might seem bad at face value by I think InnBucks has a clear plan about the position it wants to occupy in the market.

The Gist

• Simbisa is generating interest from money sitting in a till and turning those tills into ATMs
• They are now positioning themselves to get small dollar transactions
• An InnBucks API would blow EcoCash out of the water
• Simbisa operates in 9 countries across Africa, if it takes its wallet-based remittances business outside of Zimbabwe, it’s game over...

Wallet-based remittances are the new bank accounts

Don’t let anyone fool you, InnBucks is effectively a bank at this point and they are doing so through the licence of Ndoro Microfinance which was recently announced by the Competition and Tariffs Commission (CTC), the Simbisa-owned service acquired.