MTN’s mobile money service secures 1-million customers
MOBILE Money, a mobile banking initiative by MTN which uses Pick n Pay and Boxer stores as branches, has reached 1-million customers and processed over R1bn in its first nine months, MTN said yesterday.
Launched in November last year, Mobile Money is in effect a bank account that can use electronic funds transfers from the traditional banking system.
Customers can sign up for the service using their cellphones, there are no monthly fees and no minimum balances.
Money can be sent to anyone with a South African cellphone number, said Brian Gouldie, head of marketing at MTN.
Mobile Money is powered by MTN, but its required banking partner is the South African Bank of Athens, through its distribution partner Tyme, which runs the service.
Pick n Pay and Boxer provide the stores for customers to deposit and withdraw cash. The only sign-up requirements are a South African identity number, and for the customer to be over the age of 16.
Mobile Money is able to sign up new users and avoid the Financial Intelligence Centre Act requirements of proof of their physical address and identity because of a banking provision that exempts accounts with less than R25,000 deposited and a R1,000 daily transaction limit.
Transactions via mobile devices are a potential boom area for Africa, which has a lack of traditional banking infrastructure. In East Africa, the M-Pesa cellphone payment system handles an estimated 40% of Kenya’s gross domestic product.
Launched by Vodafone subsidiary Safaricom, M-Pesa has failed to launch in SA via Vodafone’s other African network, Vodacom, but has seen some uptake in Tanzania where Vodacom has a presence.
First National Bank (FNB) had been regarded as the market leader in the mobile money market with the rest of the banks playing catch-up in an area where understanding the local market is critical.
Mobile telecommunications firms are also trying to gain traction in mobile-money products to cash in on the convergence of financial services and mobile technology.
“There is no question that FNB is the market leader with regard to its mobile wallet,” World Wide Worx MD Arthur Goldstuck said recently. “Everyone else is busy playing catchup,” he said.
Mobile money involves the use of a cellphone to transfer funds between people and bank accounts, to deposit or withdraw money, to pay bills or to buy services such as airtime and electricity.
SA’s high mobile penetration rate makes mobile money the ideal vehicle to capture more than 11-million unbanked, or underbanked, adults.
Shapshak is editor and publisher of Stuff magazine (stuff.co.za). Follow him on Twitter: @shapshak