Nigeria to Miss MM Cross Border Remittance Deal

Nigeria will not be a beneficiary of the landmark deal struck by major telecom operators in Africa for the implementation of interoperable mobile money services across Africa and the Middle East regions because no telco in the country is licensed to provide mobile money services, Nigeria CommunicationsWeek has learnt.

Global System for Mobile Association (GSMA) an umbrella body of mobile networks had announced that nine mobile network operators, including Bharti Airtel, Etisalat Group, Millicom, MTN Group, Ooredoo Group, Orange, STC Group, Vodafone Group and Zain Group, have committed to work together to accelerate the implementation of interoperable mobile money services across Africa and the Middle East regions. 

But this is of no economic importance to telecommunications companies in Nigeria because none have license to operate mobile banking services.

Nigeria operates a bank-led mobile banking model where a bank deploys mobile payment applications or devices to customers and ensures merchants have the required point-of-sale (PoS) acceptance capability.

Mobile network operator are used as a simple carrier, they bring their experience to provide Quality of service (QoS) assurance.

Commenting on the development,  Emmanuel  Okoegwale, principal associate, Mobilemoney Africa, said that for the African continent as a whole, this is a positive development which will be felt quickly with cross border remittances products and services.

“GSMA as we know is largely focused on Mobile network operators so there might be a challenge with other players outside of this industry however the agreement will provide a basis for fresh and new initiatives at country level to drive interoperability. As good as it may be, some operators may not fancy it since it will disrupt their own existence and positioning, that is why continental mobile money poster child, MPESA cannot be found in the scheme list at least for now. This will replicate at different country level also. Dominant providers may opt-out where they have the advantage of a large market share.”

Okoegwale told Nigeria CommunicationsWeek that : “where the MNOs operate, it will accelerate adoption, improve access and reach of agency network, merchant point acceptability for mobile money, reduce cost of cross border remittances especially within African Nations.

At different country level, it will help regulators and providers understand why and how they need to work together to achieve inter-operaibility. In places like Nigeria where the inter operability discussion is already on, this agreement may provide some insights on achieving better outcomes”. He added

Overall, the agreement is a welcome development for Africa as a whole but it will still need to conform with different national regulations and applicable laws.

The GSMA’s Mobile Money Interoperability (MMI) programme is a global programme which also includes mobile network operators from other regions and focuses on helping them to successfully launch and scale interoperable mobile money services through identifying and sharing best practices, guidelines and processes, creating performance benchmarks, and providing regulatory support. Collectively, these operators account for 582 million mobile connections across 48 countries in Africa and the Middle East.

Central Bank of Nigeria provides interoperability infrastructure and service through National Central Switch operated by Nigeria Inter-Bank Settlement Scheme (NIBSS). This service is restricted to mobile money transactions among 16 licensed operators as well as banks and within the country.