Nigeria still at outskirts of mobile money remittances

Nigeria is still struggling with low adoption and highly fragmented agency networks and both are conspiring to hobble the growth of the industry.

Also, the country may not enjoy the benefits of reduced cost of Mobile Money international remittances because Nigerians are yet to embrace the culture of sending international remittances with mobile money.

Global System for Mobile Association (GSMA) recently discovered that the cost of sending international remittances with mobile money is, on average, more than 50 per cent less expensive than using global money transfer operators (MTOs).

Additionally, where people were able to send remittances from a mobile money account, the average cost of sending $200 was 2.7 per cent, compared to six per cent when using global MTOs. Lower transaction fees can translate directly into additional income for remittance recipients.

According to John Giusti, Chief Regulatory Officer, GSMA, “Mobile money is one of the most exciting innovations in financial services, with more than 400 million registered consumer accounts across over 90 countries. While today mobile money services are largely used for domestic transactions, international transfers represent the fastest-growing segment of mobile money services. In just a few years’ time, mobile money has moved from a purely domestic service to one that allows migrants to send remittances between more than 20 countries globally.”

Reacting to possibility of Nigeria benefiting from the development Emmanuel Okoegwale, principal associate, Mobilemoney Africa, said that e-wallet and mobile money accounts are able to accept international money transfer based on regulatory approved value, frequency and volume.

“Though the mobile payment framework in Nigeria excluded international money transfer from list of services that can be provided by licensed operators in Nigeria, however with the new international money transfer regulation framework and the licensing of some local mobilemoney operators, ability to send money directly into mobile wallets will be legal and a reality in Nigeria. Cost of remittances significantly reduces when transmitted via mobile wallets, originating or terminating into mobile wallets. Once the operations of the licensed operators pick up, we should start enjoying the benefits also in Nigeria.”

Okoegwale added that Nigeria still struggle with low adoption and highly fragmented agency network which is not helping the industry growth. “Tanzania had achieved national inclusion target ahead of time due to the success of mobile financial services. Ghana is the most improved West African nation in mobile money adoption due to some regulatory adjustments. In Nigeria, mobile banking, card services are striving but not mobile money in the pure sense of it,” he said.