Mobile money maturing in Africa
Financial services firm Fundamo has conducted research examining the opportunities in mobile money services in Africa, and has reported that it expects to see accelerated growth of such services in the coming years.
The firm, a wholly owned subsidiary of payment processor Visa, said that the Nigerian market in particular is set for phenomenal growth. Currently, only 38 per cent of the country’s 160 million people have access to formal financial services while there are more than 93 million mobile phone subscriptions in Nigeria, the most in Africa. However, according to the results of its Visa Mobile Money Study, significantly more consumers surveyed in Nigeria said that they would like to use mobile money services to save money for their family (59 per cent) and pay utility bills (58 per cent).
The firm added that consumers in the country have sophisticated financial service needs that go well beyond the established transaction set offered by mobile money services today. To meet this demand, the firm has teamed up with First Bank Nigeria to launch FirstMonie, a joint-venture that offers consumers services such as airline tickets, electric bills, insurance payment servies, cash withdrawals and payment for goods at merchant locations.
As mobile money services begin to mature and consumer demand for more sophisticated services increases, interoperability between services and the wider economy is critical to ongoing success, Fundamo argued. Its research found that 28 per cent of respondents cited a lack of interoperability with other mobile money services as a primary barrier to adoption. The firm’s parent Visa has developed Visa Mobile Prepaid in response to this to enhance the security, scale and interoperability of mobile money program.
“Start small, think big, scale quickly has always been our advice to service providers. Within 18 months of service launch, consumers understand mobile money is easy to use and secure – they trust it and start to use more sophisticated services”, said Hannes van Rensburg, CEO at Fundamo. “The next step to drive growth is breaking down the walls between services and countries to foster a rich ecosystem that connect consumers in Africa to each other and the global economy.”