African mobile money booming
Mobile financial services are seeing accelerated growth in Africa, says Fundamo.
Fundamo, a Visa Inc. company and the world’s largest specialist mobile financial service provider, was speaking at Africa Com in Cape Town this week.
The company has launched three new services – FirstMonie with First Bank Nigeria in Nigeria and Celpay with Celpay International in Uganda and Zimbabwe. Fundamo now supports a total of 27 deployments in 19 countries across Africa. Fundamo’s success is testimony to the demand for mobile financial services driven by the needs of647 million consumers in Africa that do not have a formal bank account (World Bank, 2012).
“Earlier this year the industry celebrated a decade of banking the unbanked. The market has transformed since we launched the world’s first mobile financial service in a developing economy with Celpay in Zambia. Mobile money providers are rapidly diversifying and consumers are demanding access to more sophisticated services,” said Fundamo CEO Hannes van Rensburg. “One thing hasn’t changed – Africa, the cradle of mobile financial services, continues to lead the world with a swath of new deployments in 2012.”
Van Rensburg noted that the Nigerian mobile financial services market in particular is set for phenomenal growth. Only 38% of the country’s 160 million people have access to formal financial services (Gallup and NOI-Polls, 2010). Meanwhile, there are more than 93 million mobile phone subscriptions in Nigeria, the most in Africa (GSMA, 2011). In September 2012, First Bank Nigeria launched FirstMonie in partnership with Fundamo. It is one of three deployments Fundamo powers in the market. FirstMonie is a pioneering mobile financial service for two reasons:
A recent survey by Fundamo and Visa, the Visa Mobile Money Study, revealed that consumers have sophisticated financial service needs that go well beyond the established transaction set offered by mobile money services today. For example, the majority of consumers surveyed in Nigeria intend to use mobile money to save money for their family (59%) and pay utility bills (58%). To meet this demand FirstMonie offers consumers a host of advanced services including utility payments (airline tickets, electric, insurance), cash withdrawal from an ATM without a bank card, and payment for goods at merchant locations.
FirstMonie is available to all mobile phone subscribers in Nigeria, regardless of their mobile network. It is one of the first interoperable cross-network mobile financial services in the world. It allows a consumer on one mobile network to send and receive money from a consumer on a different mobile network. The number one intended use of mobile money by consumers surveyed in Nigeria is sending money to a family member (86%).
Van Rensburg said ten years ago, mobile operators took the lead in offering mobile financial services to unbanked consumers in Africa. Today, mass consumer interest is driving demand from a range of new mobile money providers including banks and microfinance institutions. Nearly a third of the services Fundamo supports in Africa are delivered by providers other than mobile operators.
Earlier this year, Celpay International, a specialized mobile financial service provider, launched services in Uganda and Zimbabwe, powered by Fundamo. Celpay International provides mobile financial services to consumers and corporate customers. In Uganda, Celpay has partnered with mobile network operator Uganda Telecom, and in Zimbabwe it is working in partnership with several banks.
“The launch of services by Celpay International and First Bank Nigeria highlights the growing number of service providers competing to meet consumer demand in Africa,” said van Rensburg. “A great deal of credit must go to governments across Africa which are driving the principles of financial inclusion and creating regulatory environments in which services like these can flourish as part of grander ‘cashless society’ plans. We expect to see a host of exciting government schemes gain ground in the next year.”