Economy

Zimbabwe wants mobile money agents to operate again in order to boost the use of ZiG, its country’s new gold-backed currency.

Why is this news? In July 2020, Zimbabwe suspended operations for mobile money agents. The government believed the agents fueled black market currency trading practices that destabilised the previous Zimbabwean dollar.

Launched in April with hopes of reviving the economy, the ZiG is the country’s sixth attempt to fight hyperinflation. Initially valued at a promising 13.53 ZiG per US dollar, it slumped to a record low of 13.67 ZiG just a month later and efforts are being made to revive the currency.

A new proposed solution: Zimbabwe’s Treasury proposes to re-allow mobile money agents from Econet Wireless, NetOne, and Telecel to operate in the coming weeks. By allowing mobile money agents to operate again, the government hopes to boost the ZiG, ultimately reducing reliance on the unofficial currency market.

“The agents will act as a bureaux de change and help the public access small amounts of foreign currency for everyday use. This means if you have an Econet line and if you register for Ecocash, you can convert from ZiG to US dollars or from US dollars to ZiG at the official exchange rate. That is the first part to allow inter-changeability without having to go to the streets,” Kuda Mnangagwa, the deputy finance minister, told lawmakers in parliament last week. 

Measures that have been taken since the launch of ZiG: The National Prosecuting Authority reports over 100 street money traders arrested nationwide, primarily in Harare, for alleged involvement in selling against the official rate, acts that have contributed to the currency crisis.

Last week, the Zimbabwean government announced a 200,000 ZiG ($14,782) fine for individuals and businesses caught not using the official exchange rate for the new ZiG currency in their transactions. In April, the Reserve Bank of Zimbabwe released a statement expecting that all the online payment platforms convert customer balances to the country’s new currency, the Zimbabwe Gold (ZiG) before April 12.

All in all, the country is doing all it can to make sure that ZiG moves the right way. 

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Mobility

In January 2024, ride-hailing drivers across the country started the year on a sour note marked by the death of one of their own. Adebayo Padmore, a driver with LagRide, collapsed on the morning of January 8, 2024, as he prepared for what many drivers have described as a maddening routine. Padmore was one of the many LagRide drivers who have complained about the platform’s unrealistic financing models. 

In fact, Nigeria’s union for ride-hailing drivers AUATON tagged the repayment method a “killer model”.

Padmore’s death sparked conversations about the need for health insurance for ride-hailing drivers across the country. 

Now, months later, 12 ride-hailing apps have agreed to the drivers’ terms. Per TechCabal, the companies, including Rida, Bosscab, and Nairaxi, are rolling out health insurance—a first for the industry and a major victory after years of driver advocacy. The exact plans are being finalised, but initial coverage includes drivers only (family might come later).

The health insurance plan will cover routine medical checks, surgery, cancer treatments, ante-natal, and drugs.

“The HMO will be operational in the next 90 days after we create awareness in our state councils. We will start collecting check-off dues on the platforms that sign onto the agreement,” said Damola Adeniran, president of the App-Based Transporters of Nigeria (AUATON).

The big boys are missing: Unsurprisingly, Bolt, inDrive, Uber and LagRide are not part of the agreement. While LagRide initially had health insurance coverage for its divers, these benefits were paused indefinitely shortly before Padmore’s death. Bolt, on the other hand, only offers drivers health insurance as an incentive to drivers contingent on them meeting certain targets.

Moving forward, the union has plans to solidify its membership identification process. It also says it will continue lobbying for lower commissions, pension plans, and a voice in company decisions.

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Companies

Bamboo, a Nigerian investment brokerage firm that allows users to invest in U.S. stocks, has launched Nigerian stocks on its platform. 

What does this mean? This means users will have access to local assets and can now invest in local businesses on Bamboo. 

Bamboo used to just offer stocks from the U.S. Now, you can buy and sell stocks on the Nigerian Stock Exchange (NGX) right from the Bamboo App. This includes companies like Guaranty Trust Holding Company (GTCO), MTN, and Dangote Cement. Furthermore, Bamboo plans to add new listings to the app whenever a company goes public ensuring users have access to a constantly evolving capital market.

“We are thrilled to finally launch Nigerian stocks on the Bamboo platform. Among our investors, local stocks are by far the most in-demand asset class. We are incredibly proud to play a role in deepening African capital markets, starting with Nigeria”, Richmond Bassey, CEO and co-founder of Bamboo said to TechCabal. 

While there will be some trade execution fees involved like the Value Added Tax (VAT), Bamboo promises a seamless system for collecting dividend payments. Additionally, Bamboo will charge a 1% commission on NGX trades made on its platform. 

A growing branch: Bamboo’s integration of NGX stocks had been in the works for a few months. The company collaborated with the Central Securities Clearing System (CSCS), the agency responsible for clearing capital market transactions in Nigeria, and redesigned its app earlier this year in preparation for the inclusion of additional asset classes. The user interface now features a dedicated tab on the homepage and in the invest menu specifically for NGX stocks. 

Catch them young: The company claims this move aligns perfectly with its target audience, a new type of retail investor who are young, tech-savvy Nigerians and are looking for convenient and easy ways to participate in the country’s stock market. The platform is launching Nigerian investor education resources to address the knowledge gap, including stock market courses and social media content. This follows strong user interest in Nigerian stocks on their platform.

Zoom out: The Nigerian Stock Exchange (NGX) has witnessed a remarkable growth of 45.9% in 2023 closing at 74,773.77 points. As of 19th of January 2024, Nigeria is the best-performing exchange in the world, reaching a high of 94,538 points in the first three weeks and racking up a year-to-date return of 26.4%. With a share price appreciation of 1022.9%, Transcorp Hotels is the best-performing stock on the Nigerian Stock Exchange in 2023. Right behind it is Chams Holding Plc with a share price growth of 795.5%, then Computer Warehouse Group Plc, with a share price growth of 721.8%

Bamboo joins Trove, Chaka, Meritrade, Afrinvestor 2.0 and Wealth.ng, other platforms where Nigerian stocks are also traded. 

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