Major mobile money industry players have begun a high wire lobby to get the Central Bank of Nigeria (CBN) to rejig the policy framework of mobile money services after a fluttering start of the bank-led mobile money, Nigeria CommunicationsWeek can now reveal.
Mobile money touted as the next big thing is yet to make big impact more than a year after launch as some players insist the regime of regulation, is not friendly to telecoms’ firms that provide the mobile payment platform.
But the CBN has insisted that it cannot afford to licence Telcos for mobile money operation because they could use their superior technology power to control the platform.
TundeLemu, deputygovernor of the CBN in an interview recently compared the situation in Kenya, where Safaricom, the country leading mobile provider also controls over 90 per cent of Kenya’smobile payment system known as Mpessa.
“No, we won’t licence telecom firms to operator mobilemoney, that’ll be giving them chance to control the economy. We have seen what is happening in Kenya, where one telecom provider also controls over 90 percent of the mobile money industry. That is creating unnecessary monopoly in theeconomy – we won’t let that here,” said Lemu.
But in swift response, a top executive of the NigeriaCommunications Commission (NCC), the telecom industry regulatory agency said it wasn’t entirely true that telcos would monopolise mobile payment to the detriment of the banking sector.
The executive noted that every player in the economy expects to joinothers as team players to enrich the national treasury.
Although the executive pleaded anonymity stating that “there are currently high level talks. When the time comes, I will not only gladly talk toyou (openly), but the entire media. But for now, I can confirm that there areongoing high level discussions and these talks have reached quite anappreciable level. I don’t want to be seen as jeopadising the talks.”
When Nigeria CommunicationsWeek contacted a staff of the Ministry of Communications Technology with knowledge of the industry, and was informed that it was still at regulatory level; hence the ministry wouldn’t want to be seen as interfering.
“All agencies under the ministry are independent and we don’tas a matter of policy meddles into their affairs. I believe the NCC iseffectively able to handle this matter with the CBN,” the source stated.
But our investigations also reveal that high stakeholders involving persons from the telecom regulatory body, CBN, Communications Technology and Finance ministries are also involved in the ongoing discussions on mobile money.
Gbenga Adebayo, president of the Association of LicencedTelecommunication Operators of Nigeria (Alton), confirmed at the weekend that indeed there ongoing “high level discussions.”
Speaking to Nigeria CommunicationsWeek exclusively at the weekend, Adebayo said: “I am aware of the CBN statement on the mobile money payment as it affects telcos. But it is also receiving serious attention and there are ongoing discussions on the issues. I don’t want to prejudice these discussions at this point; but I can assure you that it is a matter that has attracted everyone in the economy – regulators (NCC/CBN), operators inboth the telecom and banking sectors, and every stakeholder is seriouslyconcerned at this moment.”
The Alton president noted that it was “important that every stakeholder in the industry understand the principles involved and appreciatethe enormous effect it would have on the overall economic progress of thenation.”
Mobile money is a financial transaction involving thetransfer of money from one mobile phone to another without any need for aformal bank account. Before its operation was launched in Nigeria in 2011,there was so much hype on how it would be the next big thing in the economy. Mostcritically, it was expected to surpass the success of the East Africanexperience. But nearly two years on, it crawls as a lame duck.
A number of reasons have been adduced for the ‘dead-on-arrival’take-off of mobile money operation in Nigeria, Africa’s biggest country bypopulation and the continent’s largest telecom market with over 102 activemobile subscribers.
Nigeria CommunicationsWeek’s findings showed that in most countries where mobile money is working, person-to-person transfer seems to bethe game changer.
In Nigeria however, the industry is still in the woods to clearly positionkiller services that will be a must use for the teaming masses that do not haveaccess to basic financial services and yet own a mobile phone.
Emmanuel Okoegwale, principal associate, Mobile Money Africa said that inadequate distribution and agency network constitute strong road block to thesystem.
To underline the sluggish growth of mobile money services in the country, a recent survey showedthat only 400,000 people are registered with mobile money operators in Nigeria out of 28.6 million adults operating bank accounts in the country.
The survey, which was carried out by Enhancing Financial Innovation and Access, stated that 4.8 million adults were aware of mobile money but 400,000 people actually have registration with mobile money agents.
The figure represents 1.4 per cent of the bank account holders.
The survey also shows that 0.45 per cent of the total adult population (given as 87.9 million people) in Nigeria use the mobile money facility.
It stated that mobile money was mostly used to buy airtime, with 32.9 per cent of registered mobile money users buying airtime on the platform; while 28 per cent use mobile money to send money to people.
According to the survey, 21.8 per cent of users have the platform just to receive money from people, while 17.4 per cent use it to pay bills.
The Nigeria Inter-Bank Settlement System Plcalso said that the number of registered Point of Sale terminals on the Central Terminal Management System managed by NIBBS increased from 31,000 to 185, 000 from January to November, 2012.
