Ogunsanya explains why bank-led Mobile Money drive is failing
Chief Executive Officer and Managing Director of Airtel Nigeria, Segun Ogunsanya, has opened up on why the ongoing bank-led Mobile Money is not effective enough.
Speaking at an Association of Telecommunications Companies of Nigeria (ATCON) organised reception for the Executive Vice-Chairman of the Nigerian Communications Commission (NCC), Prof. Umaru Danbatta, in Lagos, he said Telecommunication companies have been restricted to providing the infrastructure for mobile money, through which bank services can be offered. This has proved less attractive to the telecommunication companies in the country.
He said mobile money services have refused to pick up considerably well in Nigeria because the telecommunications operators have not been allowed to champion it.
In his words, “Mobile money is not taking off well because right pillars have not been allowed to champion it in Nigeria. There is need for a change in the model.”
He noted that mobile money would do well, creates more jobs and boosts the economy if telecommunications operators are allowed to champion the initiative in the country as it is been done in other climes, where it had been very successful.
Though as at the first quarter of this year, the value of mobile money transaction in the country was put at N40 billion monthly, the Airtel Nigeria CEO called on Danbatta to look into the matter and find a way around making the suggestion of a telco-led mobile money work in the country.
Statistics have shown that there are currently 21 mobile money operators in the country, which comprised 15 non-bank operators and six bank operators that have been carrying out commercial operations since the introduction of the service in 2011.
The guidelines in Nigeria showed that the Central Bank of Nigeria (CBN) is authorised by section 47 of the CBN Act, which deals with payment and settlement systems, to promote and facilitate the development of efficient and effective systems for the settlement of transactions including the development of electronic payment systems, hence the powers to issue the aforementioned guidelines.
Two models of mobile money services are identified and established by the Guidelines. These include the Bank-led Model, which recognises a bank or consortium of banks rendering mobile money services either alone or in partnership with other approved organisations. It however stipulated that the Lead Initiator shall be a bank.
The Non-Bank led Model on the other hands recognises duly licensed corporate organizations delivering mobile money services. It however, specifically stipulates that the Lead Initiator must be a duly licensed corporate organization other than a deposit money bank (DMB) or a telecommunications provider.
In Kenya, stakeholders say the success of the scheme was directly connected to the fact that it was driven by the telecoms firms.