A Case for Mobile Banking in Nigeria

Nigeria is on the verge of mobile banking explosion, a phenomenon which is expected to push up the number of the banked in the country from a pathetic 15 per cent mark.
Recently, the Central Bank of Nigeria (CBN) issued MoneyBox license for mobile banking – a development industry watchers have considered laudable. Tagattitude of France, MTN, and a couple of others are at various stages of deployment of mobile banking services in the country.
The success of M-pesa in Kenya is expected to be replicated in Nigeria given a favourable regulatory environment. The CBN has so far, shown enthusiasm in observing the current trend sweeping across the globe.
The Philippines for instance, has been a world leader in mobile banking, enabled by a progressive regulatory regime provided by the country’s Central Bank, which has consciously promoted “branchless banking.”
In the Philippines where people with mobile phones far outnumber those with bank accounts, as in Nigeria, the use of such instruments has had a transformational effect on Filipinos’ access to finance. 
The current environment there shows that the telecommunication companies have recognized this opportunity. Smart Communications in 2003 and Globe Telecom in 2004 launched the electronic money concept, which they called Smart Money and G-Cash, respectively.
The Smart Money technology allows users to make purchases, pay and receive domestic payments and receive remittances by loading or transferring money from a bank account into a mobile phone account or reloading a prepaid card (smart card) electronically through the mobile phone.  The G-cash is a similar technology which provides the same services but does not use a debit card and instead just uses accredited cash-in and cash-out outlets via the mobile phone.
Usage volume is steadily increasing with an estimate of around 8 million customers with electronic money accounts, and banks are actively making use of these available platforms in providing financial services, including microfinance services. 
The mobile phone is turned into an electronic wallet where transactions can be made through SMS. This is seen as a revolutionary solution for low value payments and has dramatically lowered transaction costs for both the bank and the client, increased the productivity of account officers, decreased cash-on-hand risk and increased accessibility to the financial services.
But issues bordering on security of mobile payment networks have been raised and are considered critical for the success of mobile banking in Nigeria. Be that as it may, Nigeria has launched on that expedition just as other developing countries, and it promises to be a sure and steady one.