Nigeria’s mobile money scheme crawls at 1% penetration

GSMA certifies four operators to boost service
After about five years of operation in Nigeria, mobile money has only been able to attract just one per cent penetration.

Unlike in Ghana and Kenya where penetrations have reached 40 per cent and 60 per cent respectively, only about two million of Nigeria’s estimated 198 million populations.

The implication of this is that despite the innovation that comes with it, Nigerians are yet to tap from the huge benefit it carries.

Market watchers have argued that the model operated in Nigeria, which is bank-led, has not been able to impact the initiative in the country adequately.

Nigeria is currently home to about 21 mobile money operators, which comprised 15 non-bank operators and six bank operators that have been carrying out commercial operations.

The Executive Vice Chairman, Nigerian Communications Commission (NCC), Prof. Umar Danbatta, at an interaction with journalists in Lagos, on Monday, lamented that mobile money is crawling at one per cent penetration in the country because it is bank-led.

According to him, other region, where the scheme is thriving has been because it was telco-led, “as such we need to re-direct our focus and ensure that appropriate model is adopted adequately.”

Danbatta said there should be effective cooperation among all the various stakeholders in the value chain that is the telecommunications operators, agents, CBN and the services providers too.

The NCC EVC revealed that discussions are on-going in the industry on how to get telcos to become super agents in the scheme of things.

“With the population we have in the country, Nigeria should play big in the mobile money ecosystem in Africa. Only about one per cent that is about two million Nigerians is currently on the scheme. That is rather too poor. All hands must be on deck to revive that sub-sector of the economy.

“If we are to improve on Nigeria’s digital landscape, we must revive the mobile ecosystem, which includes the mobile money scheme,” he stated.

Meanwhile, at the just concluded Mobile 360 – West Africa event held in Abidjan, Côte d’Ivoire, the Global System for Mobile Telecommunications Association (GSMA), he launch of the GSMA Mobile Money Certification, a global scheme for mobile money providers to offer safer, more transparent and resilient financial services to millions of mobile money users around the world.

The certification relies on an independent assessment of a mobile money provider’s ability to deliver secure and reliable services, to protect the rights of consumers and to combat money laundering and terrorism financing.

The certification is designed to enhance consumer trust and accelerate commercial partnerships by setting a high bar to which all providers can aspire.

Chief Regulatory Officer, GSMA, John Giusti, said the Mobile Money Certification is a consumer-focused initiative, aimed at giving customers confidence that a provider has taken steps to ensure their funds are in safe hands, their rights are protected and they can expect a high level of customer service.

“With over 690 million accounts globally, the mobile money industry is having a clear impact on the global effort to expand financial inclusion, providing access to life-enhancing financial services and serving as a gateway to the digital economy.

“Mobile money is directly advancing 13 of the 17 Sustainable Development Goals by facilitating access to essential services such as health and education, providing employment opportunities and reducing poverty,” he stated.

The certification scheme follows a three-year consultative process led by the GSMA, which worked together with providers in Africa, Asia and Latin America to understand the challenges of their business and assemble best practices from these markets.
Certification is open to all mobile money providers, whether they are a mobile operator, a bank or other type of payment service provider.

Orange Côte d’Ivoire, Safaricom (Kenya), Telenor Microfinance Bank Ltd. (Easypaisa Pakistan), Tigo Tanzania (Millicom Group) and Vodacom Tanzania are the first to be certified, covering 98 million accounts in four markets.

The certification promotes the application of consistent risk mitigation and consumer protection practices across key areas of business. The requirements include a set of eight high-level principles and 300 detailed criteria covering issues such as security, consumer rights and the prevention of money laundering, financing of terrorism and fraud.