Until recently, Paypal the largest international online merchant finally lifted its restrictions against users in Zimbabwe. Paypal considered Zimbabwe a sanctioned country and denied access to its platform to users from Zimbabwe.

The sanctions were related to the “targeted” sanctions against certain individuals in Zimbabwe which have been in force for over a decade. The restrictions are however location based and not targeted on certain specific individuals. This has had a negative long term barring on the country’s economy and international trade development abilities through adaptation and utilisation of ecommerce.

For now users in Zimbabwe can create accounts, make deposits, transfer funds and make payments to other users. However, you cannot transfer funds into Zimbabwe directly as Paypal still does not recognise users with Zimbabwean physical addresses. This makes trading using Paypal very expensive due to the transaction costs and exchange rates losses resulting from the various transfers one needs to do to get money into Zimbabwe from Paypal. A practical case we faced was when we had to receive funds from abroad this year and the client preferred to use Paypal. The company lost nearly US$600 on just one payment which is a lot of money by any standard. Also, Paypal does not have a maximum service fee per transaction and will charge you to get the money in and out of their platform. As an alternative, Zimbabwean nationals have to use a non-Zimbabwean physical addresses and a non-Zimbabwean bank account to be able to fully utilise their platform. This scenario makes Paypal not safe for local users as Paypal can easily freeze and forfeit funds on the basis of falsification of user information.

Online trade restrictions by Paypal have however created room for innovation and employment through the creation of local Paypal alternatives that we are now using such as Paynow, VSAT and other payment gateways such as the CBZ Ebanking online merchant services. Paypal however remains the most popular and most trusted online merchant which undermines efforts for most ecommerce facilities such as AVAC Arts from Zimbabwe to trade internationally as most international potential clients trust and prefer to use Paypal. Globalisation in an information era calls for international trade through use of ecommerce. International trade is imperative for any country to have a healthy Balance of Payment(BOP) position towards an elevated Social welfare. Such restrictions are doing more harm than good to the country and its people.

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