Introduction

With constant adaptations with transformational changes in the country, Zimbabwe has moved towards a state of evolution. The drivers have been the financial challenges, inflationary pressures and growing demand of digital financial services. The side of these challenges that takes Zimbabwe to a positive transformational journey is actually the one where digitization is making up for most of the solutions in the financial realm of the country. The shift of the society from cash dependency to the increasing use of digital wallets, digital money, and instant payments has revolutionised and redefined payments systems for businesses, individuals and organisations in Zimbabwe. Let's look at how the payment rails of Zimbabwe are developing and how its bringing gradual and sturdy change in the economic status of Zimbabwe!

The evolution of the payment infrastructure in Zimbabwe 

Zimbabwe’s economy has faced various structural challenges and the economy has come crashing down at various stages of development. Crises like inflation caused by currency volatility, liquidity challenges and technological hurdles making cash the foremost contender have all given rise to filling the gap by inducement of electronic payment stems, card and digital payments and mobile services. At present, Zimbabwe’s financial system is built on 3 key pillars;

1. ZIPIT Zimbabwe (Zimswitch platform): the platform enables easy account to account transfers across banks and wallets connected to the Zimswitch network.

2. EcoCash mobile money: this is a financing solution outside of the formal financial sector, it provides services to millions who don’t have access to formal banking.

3. Digital wallets Zimbabwe: many digital wallets across the network enable prepaid and app based solutions for payments, settlements and remittances. 

These make up for the major part of Zimbabwe’s financial infrastructure. Fintech and digital assets transfers platforms are the new players in the economy making a gradual impact on the existing payments rails of the country. Let's look at each prospect in detail.

Instant Payments with ZIPIT Zimbabwe

An important development in the country’s financial infrastructure setup, ZIPIT (Zimswitch Instant Payment Interchange Technology) has become a strong driver for the way payments work in the country, lets find out how this backbone of payments works;

ZIPIT has a realtime payment switching system connecting banks and mobile money services along with digital wallets. It basically makes it extremely convenient for sending and receiving funds instantly irrespective of the payment institution involved as long as it's a part of the ZIPIT network. The key features of this network are;

1. Its 24x7 availability makes transfers possible anywhere at any time. 
2. Transactions cost less compared to traditional banking and cash transfers
3. It enables seamless movement of money across banks and wallets. 

Overall, this system has proved to be beneficial in reducing cash reliance and enabling faster transactions for businesses and individuals. It hence becomes the backbone of instant payments in Zimbabwe. 

Mobile money revolution with EcoCash 

The definition of mobile money in Zimbabwe has come to be centred around EcoCash which is the largest and most widely used mobile platform used in the country. Curated by Econet Wireless, EcoCash allows users to send and receive money, pay bills, step in the purchasing cycle and more actions, all using a mobile phone. The major impacts of ecocash on the economy are;

1. It has helped a large number of unbanked access financial services.

2. It has helped businesses of all sizes, traders and ecommerce platforms grow.

3. Being integrated with ZIPIT and other digital systems makes it efficient and enhances interoperability.

Ecocash has clearly played a transformational role in the economy making it a lifeline for digital payments and day to day settlements likewise.

Digital Wallets in Zimbabwe

Beyond EcoCash, various digital wallets are also available in Zimbabwe now making a significant impact on how transactions happen. These solutions allow users to;

1. Store funds digitally and access them from anywhere.

2. Conduct P2P transfers as well as merchant payments.

3. Also handling cross border payments to and from Zimbabwe including remittance and other settlements. 

The adoption of digital wallets and EcoCash has happened hand in hand due to the relative increase in smartphone and internet usage and widespread digitization across the country. 

The future of digital payments in Zimbabwe 

It's a national priority to expand the digital systems significance and financial inclusion in the country at even better rates, many reforms for the same have constantly been executed. The entry of crypto as a payment medium, especially digital assets like stablecoins has taken place to resolve and counter the same. Benefits of better means and inclusion include;

1. Reducing reliance on cash and collective movement towards digitization which is better approached now with all these digital transformations in the country’s financial infrastructure. 

2. Providing chains of safer and transparent payment networks via blockchain technology which makes payments quick and secure. 

3. Enabling businesses of all sizes accept electronic payments and enabling better reach to all industries and markets. 

4. Initiating and increasing access of savings and easier credit to the underbanked regions of the country.  

Combating all shortcomings of the local payment rails like network outages and delays, high service fees and lack of transparency, this new wave of digital asset payments are proving to be the ultimate payment solution to accommodate the country’s payment needs.  

The growth of Digital dollar - Stablecoins in Zimbabwe is the new norm for realising the best side of the financial realm.  

Stablecoins and digital rails with TransFi 

While stablecoin usage is not that widespread in many African regions where it's still gaining traction, many platforms allow users in Zimbabwe to buy stablecoin and crypto easily facilitating the high adoption. They offer various funding methods which are used on a day to day basis. The conversion of local currencies to stablecoin and crypto is easy to achieve and Global solutions like Transfi are also coming into play providing their best conversion setups for the native community. 

TransFi is the best solution for cross-border payments with crypto in Zimbabwe. It connects stablecoin rails to 40+ fiat currencies and 250+ local methods, in an instant, compliant, and secure manner with no hidden fees as well as transparent rates. These technological breakthroughs might seem complex at first but they make transactions extremely accessible and easy, let’s look how; 

1. Stablecoins provide a hedge against volatility as they are pegged to the US Dollar and are not susceptible for depreciation on a regular basis unlike Africa’s currencies. 
2. Stablecoins ease cross border payments and remittances by high speed and lower costs.
3. They play an important role in E-commerce and International trade
4. They also provide financial inclusion to the widespread unbanked population. 

With stablecoins and a strong infrastructure in action, Zimbabwe is headed towards positioning the country among the digital leaders of Africa.

Conclusion

African countries are no strangers to the use of digital solutions for money transfers, nor to the rapid implementation of such technologies. It is often said that the pervasiveness of mobile telecommunication usage in Africa, enabled the continent to leapfrog many first-world countries. There is already an abundance of local mobile and e-payment platforms that have seized this as an opportunity to develop innovative ways to reduce the friction associated with transferring money across the continent. An example is Transfi, which has been used widely for crypto and digital asset transactions allowing customers to send and receive money via digital assets, various currencies, cryptos, etc. its time for Zimbabwe to realise its economic potential by utilising the best fintech resources! 

Also read: Togo’s Payment Rails & How They Work – GIM-UEMOA, Mobile Money & Expanding Instant Transfers

Frequently asked questions (FAQs)

1. How is Zimbabwe advancing towards digitization of payments?

These payments in the country are advancing through;

• E-governance and digital payment reforms taken up by the government.
• Encouragement of cashless payment systems among banks and telecom providers facilitating these payments for subordinate bodies as well.
• Upcoming and flourishing fintech solutions in the private sector.

2. Which is the best platform to receive crypto payments in Zimbabwe?

TransFi is the best platform to receive crypto payments and remittances for the residents of Zimbabwe. It’s powered by stablecoin rails, supports USDC and USDT, offers instant, secure, compliant remittances, and integrates with 250+ local payment methods across 40+ currencies and 100+ countries. 

3. Which stablecoin is the most viable for businesses across the world? 

USDT and USDC are still, by the majority, the most popular stablecoins, which are famous for their stability and liquidity.

4. Is it legal to use stablecoins in business transactions in Zimbabwe? 

Yes, stablecoins are legal in the majority of the countries of the world, but it is necessary to check the laws and regulations of the local government before getting started. In Zimbabwe, the adoption is gradual and stablecoins are widely accepted for exchange and transactions while there are no particular regulations on these lines. 

5. Why Are Global Businesses Turning to Stablecoins?

Overall, stablecoins have established themselves as growing and significant components of the global payment infrastructure, with expanding usage across transaction types and regions, pointing to their growing centrality in the international economic system.