MTN-Rwanda eyes cross border mobile money

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MTN-Rwanda is planning to expand its mobile money product across borders

With growing   competition in mobile banking in the telecom sector within the country, MTN-Rwanda is now looking at venturing into cross border mobile money transactions, a move seen to beef up its position as a leading telecom by assets, revenues and subscriber base.

Accordingly, MTN Rwanda will be partnering with MTN Uganda in harmomising the mobile money platforms thus allowing its subscribers to   send money across the border.

“We are working with   MTN Uganda to harmonise our platforms so that our subscribers can send money to MTN Uganda subscribers,” Arthur Rutagengwa, Head of Mobile Money at MTN said on phone.

Indeed, considering the time and convenience the cross border mobile money business is becoming an option for people paying   across borders, something looked at to boost the fragile   cross border trade.

“As  long as  we are  able to pay each other  across the border without the  hassle, then  business  is well facilitated,” said Tadeo Karuhanga, a cross  border  trader  from Uganda.

Expected to be implemented soon, the MTN’s cross border mobile money will come as a new tool for the leading giant to shove off the competition from its rival Tigo Rwanda which launched the same product with its sister company in Tanzania.

“We have received a great response from customers, including customers with family ties between the two countries, as well as businessmen doing cross border trade,” said Tigo’s Daniel Barrientos

Experts believe that the shift to cross border   transactions   by telecoms will help boost their revenues that have been facing low returns in voice revenues and fragile data that is yet to be conquered by the low cost internet usage.

“Since we have Open economies on both sides of the borders, implementing the product will not have complications and returns are enormous,” said Anand Sharma, technology expert at Techno Brain Rwanda.

Mobile money – the use of cell phones for money transfers, payments and more sophisticated financial activities such as credit, savings, and insurance – is increasingly popular in East Africa.

Telecom experts note that Mobile banking is another milestone in achieving a cash-lite economy, where sending and receiving money through the mobile phone is more flexible, convenient, and faster than using cash.

“This is the result of deep understanding of consumer needs combined with an innovative portfolio of products including money transfers, payments, airtime reloads, cross-border transfers and bank integration….,”  Barrientos added

Further still, telecoms have recently been looking at developing more products to ease payments and help in ushering in a cashless economy the country banks on to leapfrog to middle income by 2020.

“We launched a bank integration service where customers can use their MTN Mobile Money accounts to deposit and withdraw money from their bank accounts,” Norman Munyampundu, General Manager of MTN Business earlier noted

But   despite this achievement by  telecom  operators  within their respective  countries, the cross  border  mobile money  remains  informal  and a challenge   due to  lack of a harmonized regional  cross border  mobile  money platforms as  well as regulatory frameworks.

While it offers the potential for increased financial inclusion, it could benefit from region-wide rules to coordinate and harmonize regulations, the report by UN conference on Trade and Development-UNCTAD stated

Accordingly, the report entitled Mobile Money for Business Development in the East African Community: a Comparative Study of Existing Platforms and Regulations, focuses on the region a way of addressing issues raised by mobile money.

It adds, “Steps are needed to address concerns related to consumer protection, registration and transaction limits, regulatory collaboration and interoperability, meaning interconnection between telecommunication networks”.

The report says that   there is need for keen coordination and cooperation across various regulatory and market sectors, such as telecommunications, banking and electronic commerce.


This according to experts would require interoperable platforms between different telecoms as well as the   financial institutions.




About the author

Olive Ndaka is the Junior Editor for RwandaEye. An investor and young entrepreneur, she is a quick learner and has contributed many articles for RwandaEye in Kinyarwanda.

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