Mobile money agents and bulk paying merchant lines in Zimbabwe have been put out of business, while merchant accounts will only receive payments after the central bank softened a tough government directive that had completely banned mobile based monetary platforms and ordered that trade on Zimbabwe’s Stock Exchange (ZSE) be suspended until further notice.

Zimbabwe imposed the blanket ban on mobile money platforms and trade on the ZSE on Friday, arguing that these were aiding in the rapid plunge of the Southern African country’s currency, the Zimdollar.

Nick Mangwana, the permanent secretary in Zimbabwe’s Information Minister said over the weekend that “any continued let up in the regulation of mobile money platforms would lead to the collapse” of Zimbabwe’s economy.

Mobile money operations EcoCash, Telecash and OneMoney had been affected, along with non-telco run company, MyCash – which allows for movement of funds across mobile and banking platforms.

On Sunday Reserve Bank of Zimbabwe governor, John Mangudya said that the monetary authority had settled for a ban on agent lines, bulk payments and restriction of merchant lines to receiving payments only.

“All mobile money liquidations should be done through the banking system. All mobile money agents are suspended from facilitating mobile ­financial transactions with immediate effect,” said Mangudya.

EcoCash has been described by the government as being the “centre pivot of the galloping black market foreign exchange rate” while agent lines held by big companies are said to be the “conduit” of the schemes.

EcoCash issued a notice to subscribers on Sunday confirming agent lines had been disabled while bulk payments were now also no-longer available on the platform.

“This therefore means that cash-in and cash-out services have been suspended until further notice. Merchant-to-merchant and merchant-to-individual transactions have also been suspended until further notice,” the platform stated.

Meanwhile the ZSE confirmed trade on the market had been suspended “until further notice”.

The government has accused some counters on the ZSE and EcoCash of contributing towards the Zimdollar’s drop in value.

Mangwana added that mobile wallet companies in Zimbabwe were creating “illegal transient and permanent money through airtime loans, unaccounted wallet-to-bank and bank-to-wallet” transactions.

He said the government has intelligence that mobile money companies are “maintaining unauditable mobile phone lines or accounts which are being used by criminal syndicates… to steal money from subscribers through fraudulent” practices.

Some counters on the ZSE also stand accused of “illegal externalisation of foreign currency through transfer mispricing” while mobile money companies are also further accused of “acting as banks”.

Zimbabwe last week adopted a new foreign exchange rate regime hinged on a weekly auction.

The next auction is scheduled for 30 June 2020 after last week’s inaugural bids fixed the exchange rate at a weighted average of 1:57 compared to the street exchange rate of about 1:100.