ECONOMIC analysts and hard-pressed Zimbabweans have lamented the central bank's recent study, which revealed that citizens use an average of ZW$116 (US$1,39) daily on mobile money platforms.
Reserve Bank of Zimbabwe (RBZ)'s Monetary Policy Committee member Eddie Cross last week said the apex bank used findings of the study to peg daily limit transactions of ZW$5 000 (US$60) on mobile money platforms.
Although Zimbabwe has various mobile money platforms, the industry is dominated by Cassava SmarTech's EcoCash platform, which enjoys a 95% market share.
"In the past 12 months, EcoCash handled 1 938 billion transactions worth ZW$225 billion (US$2,7 million) -- an average transaction of ZW$116. This means that the limit of ZW$5 000 should cover the great majority of transactions," he said, adding that the limit would be reviewed when the situation settles down.
Market players, however, said the Central Bank was so divorced from reality hence their tendency to craft policies that pile more misery on the already-suffering citizens.
"I think this analysis is erroneous because prices have moved so much over the past 12 months. Also ZW$116 is just US$1,39. So you cannot argue that on average everyone would want to transact for a dollar," former Zimbabwe National Chamber of Commerce president Trust Chikohora said.
"This will just slow down economic activity and put new bottlenecks in the economy. In fact, the irony is that it will increase the propensity for people to just transact in United States dollars," he added.
Although the government has for years been urging people to increase their use of mobile money and plastic cards, its actions in the past few months -- such as restricting the use of merchants and bulk payments as well as banning EcoCash agents -- has seen consumers resorting to using cash, which is not available at banks.
This development has brought anxiety to national business organisations such as the Confederation of Zimbabwe Industries (CZI), which recently noted that the country was on a re-dollarisation path due to policy inconsistencies.
CZI attributed the widespread use of the US dollar for transactions in the informal sector, fuel sector, payment of wages and salaries by private sector, pricing by large supermarkets and the provision of most private medical and educational services to rising inflation.
Zimbabwe's annual inflation surged to 837% in July, the highest in Africa and the second highest in the world after Venezuela, thus significantly eroding people's purchasing power.
Economic analyst Victor Bhoroma said in light of the country's challenges, it was crucial for policymakers to implement policies that improve people's lives and not hinder growth.
"I think ZW$5 000 is more on the low side as a transaction limit considering the level of inflation, prices of goods in most retail outlets and the level of electronic transactions in the economy. ZW$5 000 equates to approximately US$50 (at parallel market rates)," he said.
"The transaction limit will obviously place a cap on merchant payments and banking transactions which will add more fuel to re-dollarisation as most traders will try by all means to avoid banking channels and evade taxes."
Bhoroma said the central bank should adjust the daily mobile money limit to ZW$10 000 and constantly review it in line with inflation.
"Obviously, the Financial Intelligence Unit should track any abuse of mobile money for other parallel market deals, but the level of electronic transactions in the economy calls for a greater need for mobile money usage and flexibility of limits," he added.
The limits imposed by the RBZ have already resulted in businesses registering lower business activity than before the directive, while farmers and those in the formal sector are now struggling to procure inputs, raw materials and pay their bills.
Sandra Masendu, an economics student, said the central bank's analysis should not go unchallenged as it does not reflective reality on the ground.
"The law of averages in statistics is particularly susceptible to the influence of outliers. These are values that are unusual compared to the rest of the data set by being especially small or large in numerical value," Masendu said.
"For instance, an old woman in a rural set-up does not transact as much as someone who is economically active in an urban area. As such, you cannot put these totally diverse people in the same category. At the moment ZW$116 is not enough to buy 1kg of sugar or two loaves of bread."
Masendu also indicated that the Covid-19-induced lockdown had resulted in most people relying on mobile money platforms to pay bills, buy airtime and send money to friends and relatives, as a way of combating the deadly pandemic.
"This shows there is an urgent need for the monetary authorities to review the ZW$5 000 daily limit, which honestly does not buy anything meaningful, and allow people to transact easily in the comfort of their homes," she said.