TelOne sets punitive interest rates on outstanding balances
By Staff Writer | 10 Jul 2019 at 19:26hrs
STATE-OWNED fixed telecoms operator, TelOne has released a notice warning post-paid users that they risk spending more than they have to if they don't clear outstanding balances by the 15th of July.
TelOne advised its customers that all outstanding balances not paid by the 15th of July 2019 will attract an interest charge of 30% per annum.
"This notice serves to advise our valued clients that all outstanding balances not paid by the 15th of July 2019 will attract an interest charge of 30% per annum without further notice.
"This applies to all customers with unpaid balances for Voice and Broadband services. We, therefore encourage our clients to settle their outstanding balances and avoid inconveniences," said TelOne in a notice sent to its clients via email.
Unpaid Government debts amounting to $93 million, 62 percent of total debt, are largely the reason it has struggled to meet obligations to critical local creditors who are owed nearly $100 million.
Since its debtors are taking too long to pay up, TelOne's trade debtors' book only decreased by a mere 7 percent from $162 million in 2017 to $151 million 12 months later.
The amount of outstanding accounts receivable is made up of balances due from Government ministries, parastatals, corporates and household clients.
TelOne said its debts to service providers and other creditors increased by 7 percent from $152 million to $162 million while its external debt had also ballooned to $32 million due to challenges it has faced getting requisite foreign currency.
"Settlement of critical local creditors of $98 million has been affected by late settlement of what is owed to us. Local creditors, namely Postal and Telecommunications Regulatory Authority of Zimbabwe, Zimbabwe Revenue Authority, local interconnection partners and the Pension Fund are collectively owed $93 million," managing director Chipo Mtasa told TelOne's annual meeting this week.
"Delayed settlement by debtors continues to have a negative impact on the company's ability to settle critical statutory and contractual obligations," she added.
Ms Mtasa said while mindful of economic challenges being experienced by the country, TelOne continued to implore all clients to settle their debts to allow ease of business.
"To this end we have put in place different strategies for debt collection including black listing or litigation where necessary. This has resulted in a 26 percent increase in collections of at least $64 million between January and May this year," she said.
TelOne, has been threatened with service disruption by critical foreign suppliers, who include West Indian Ocean Cable Company (Wiocc) and China-EximBank, among others, over an $18 million debt.
TelOne owes China-EximBank $500 000 in interest and repayment on the $98 million loan facility which funded the phase 1 National Broadband Project (NBBP).