Mobile Banking services picking up in West Africa
Mobile banking has proven a success in East Africa, especially Kenya. But West Africa is quickly picking up the new technology. Now it is Ghana’s turn to establish a mobile banking service. The changing phone usage is about to transform the financial scene in this West African country.Michael Egbe is one of the people getting onto the new mobile money market. Sitting under his branded umbrella to shield himself from the scorching sun, Egbe sells mobile telephone accessories. He is installed next to a busy street with people walking up and down, transacting business - hence Egbe’s choice to sit at the noisy side of the road to catch the attention of his customers. Every minute a customer walks up to Egbe to buy airtime.
He is excited that there will be more for him to sell in the future. Another product added to the menu will earn him more money. “Mobile money is very good,” he says, “it can help you so as not to carry money on you, yet be able to send money to friends and family in far off places.”
MTN is curving its market niche in mobile money market
Everywhere you look in Ghana people are using their mobile phones. In the MTN offices, people are signing up to use the new facility while others are looking for the opportunity to be appointed agents.
The MTN Mobile Money works just like the mobile money transfer programs that have existed in Kenya like the MPesa facility run by Safaricom and Zain’s Zap mobile money transfer. Uganda is also among the countries served by MTN and Zain, and will soon roll out the new development.
Eli Hini, Commercial Senior Manager in charge of MTN’s new Mobile Money program says there is a huge potential in the Ghanaian market. He sees the increased mobile telephone ownership and usage as the main telling signs that the product will succeed. “We believe that in Ghana it will give us the same opportunities as in Kenya, since more and more people in Africa have mobile phones.”
Basic financial management service now at the finger tip
Hini is thrilled that on a continent where only one in ten people has a bank account the introduction of mobile money facility in Ghana could see the over 90 per cent of people without bank accounts get access to financial services. “MTN mobile money service is providing basic financial management service on the mobile phone. We all know that the mobile phone has become a common tool in our society, and people who own mobile phones keep on increasing by the day,” says Hini.
Robert Holzmann, World Bank specialist in Long Term Savings, calls the mobile money transfer facility a crucial innovation. “This is a crucial innovation for the whole world and for Africa,” he says, “it is a cheap to make the exchange of money in a simple.”
He sees the new development as an avenue through which to expand access to financial services, but warns that the facility also has limits. Holzmann thinks the mobile money transfer concept does not encourage saving while at the same time encourages impulse spending of the money. “One could conjecture that it’s a concept that is not conducive to saving as much as one would have hoped.”
Where does this leave the consumer?
Consumer International’s Executive Director Samuel Ochieng’ feels that more has to be done to protect users.
“The use of mobile phones to transfer money is gaining momentum, the volumes being transferred is in billions of dollars or shillings, but what we want to see is more responsibility from governments to put in place legislation and at the same time enforce the law through regulation to protect the users” says Ochieng’.
For business people like Michael Egbe access to finances is the key. He sits by the side of the road to sell airtime – but with the new development, his customers might stop coming to him, as buying airtime will be much easier from the accounts on their phones. Judith Akolo