The goal is not to compete with the banks
In Central Africa, unlike East or West, telcoms can only offer mobile money in partnerships with banks. Within this framework MTN is focused on reaching out to the informal sector
TAR: Why is MTN involved in the mobile money sector? ALAIN NONO: MTN’S global strategy is to expand financial services, and this includes money transfers. We started diversifying several years ago to create new revenue streams, as the tendency with 4G is for voice revenue to drop, especially with the arrival of over-the-top services. So for several years MTN has been looking for new revenue streams, especially in terms of digital services. We started in mobile money in 2010 and it started off very slowly as it was something new for us. We have been sharing our experience with other operations, and things have really been picking up over the past two years. It is not something we did on our own but within the regulatory framework. Regulations are tight in Cameroon and within the Communauté Economique et Monétaire de l’afrique Centrale. The goal is to bring money from the informal sector into the formal sector. The goal is not to compete with the banks, as the banks are our partners. We are doing what the banks have not yet done, which is to turn to informal or unbanked customers.
“We are doing what the banks have not yet done, which is to turn to unbanked customers”
What part of your business does mobile money represent? I am not going to give you specific statistics because of confidentiality. What I can say is that there has been significant growth in revenue tied to mobile money over the past year […]. We have more than 12,000 mobile-money agents who have an active account […]. We have 10 million clients and today they have 3.6 million mobile-money wallets. What I can say is that we estimate that, [measured] over a three-month period, we are on equal footing with our principal competitor in the market [Orange Cameroon].
There have been some recent polemics about the management of the sector, and the telecommunications ministry said it is going to look at mobile-money regulations again. Do you expect any changes? I think journalists are the ones launching the polemics to sell papers. […] The regulations are firm and clear and spell out what transactions are allowed. The client can make deposits, withdrawals, payments and transfers from one client to another. And all of those transactions are done under the super vision of the mobile firm’s banking partner. At this level, there are absolutely no regulatory problems. So when we see in the papers or hear in the streets that we are doing an unregulated activity, it is not true.
Orange Cameroon has introduced a Visa card for its mobilemoney clients. Are you thinking of similar innovations? With a local bank we are introducing a solution that allows for withdrawals without a card. You can go to any cash point and withdraw money by validating it with your mobile phone. Today we are using mobile phones to make some payments at petrol stations and we are doing something similar as a pilot for some shops. We would like to embrace the broader spectrum of financial services […]. In terms of usage, topping up your account is one of the principal uses of the mobile wallet in Cameroon. That is followed in terms of popularity by money transfers and payments for goods and services.
In more developed mobilemoney markets, accounts are being used to build up credit profiles and offer services like loans. Is that possible in Cameroon? We can’t exclude investigating such services in the future. Some of our operations provide such services […] but always in partnership with financial institutions. In East or West Africa, regulations are less restrictive, and mobile operators are allowed to emit mobile money themselves. Interview by Reinnier Kazé in Douala and Marshall Van Valen