August 14, 2012 – Immaterial airtime seems to be the solution to a vital problem of Zimbabwean economy: the overwhelming, ubiquitous lack of coins and hence of small change. Since in April 2009 Zimbabwe has officially suspended the Zimbabwean dollar currency due to hyperinflation accepting instead primarily the South African Rand and US dollars, the country lacks coins. This case shows the importance of physical money and the problems that arise in times of shortage.
Bus rides led to fighting scenes as drivers often pair passengers when giving back change. Instead of paying 50 cents to each, they handle a one dollar bill to two passengers who have to find a way of splitting up later. Some bought cookies or other things they could share. But doing so continuously for 50 cents means waste in a country where many people have to live on $2 a day and even less. A security agent even shot a driver dead because he was not able to give small change.
Many solutions have been tested or at least thought of: Importing US coins would have become to expensive, giving coupons for change instead of coins encouraged fake paper coupons, credit notes were often printed on thermal paper which tends to fade away soon. Quite curiously drivers accepted a South African five rand coin as equivalent to 50 US cents, despite of the real exchange value. Naturally this created a whole smuggling business of five rand coins from the neighboring country into Zimbabwe.
Supermarkets gave small items to their customers – after having rounded off the sums! This was not seen well, however, now it seems that a widely accepted ‘currency’ has been found: airtime. People do not complain any longer and supermarkets can credit pre-paid mobile phones directly with 10 cents to $50.
To read an article on this subject, please click here.