Online money transfer service WorldRemit and Africa's largest mobile operator, MTN, have signed a global partnership that will enable WorldRemit customers to send remittances instantly to MTN's Mobile Money customers.
According to WorldRemit, the agreement positions the transfer service as the leading provider of remittances to mobile money users (also known as mobile wallets) at a time when the technology is experiencing rapid uptake, especially in Africa.
"Mobile money is rapidly displacing cash as a way of receiving money from friends and family abroad. WorldRemit's partnership with MTN allows our customers around the world to send money instantly to MTN Mobile Money users," says Ismail Ahmed, founder and CEO of WorldRemit.
"As well as being fast and convenient, MTN Mobile Money is reaching millions of people who don't have bank accounts, giving them access to a variety of life-enhancing financial services, including savings and insurance schemes."
MTN Mobile Money is used by 22.2 million customers in 16 countries across Africa. To kick-start the partnership, MTN's operations in Uganda, Rwanda and Zambia will be added to WorldRemit's list of mobile recipient options, with additional countries following soon after.
"The partnership with WorldRemit is yet another important step in our journey to enable the affordable transfer of monies across borders. Our remittance strategy places the customer at the heart of any offer we introduce as MTN and, working with WorldRemit, we intend to further extend the convenience of MTN Mobile Money to our customers," says Pieter Verkade, MTN group chief commercial officer.
More than 50% of all WorldRemit transfers to Africa are received in mobile money accounts or as mobile airtime top-ups, says the company.
Growing popularity
According to research firm Frost & Sullivan, mobile money is shaping up to be one of the most exciting areas in mobile communications and is quickly transforming the way in which consumers and enterprises transact.
The company says mobile network operators are taking advantage of the growing popularity of mobile money to boost average revenue per user and counter the increasing pressure on voice revenues. Mobile money services, notes Frost & Sullivan, have become central to operators' growth strategies.
New analysis from Frost & Sullivan, "Analysis of the Mobile Money Market in Sub-Saharan Africa -Selected Countries", finds the market earned revenue of $655.8 million in 2014 and estimates this to reach $1.3 billion in 2019. The study covers mobile payments and mobile money transfers.
There has been a substantial rise in the adoption of mobile banking services as the majority of Africans have limited access to traditional banking services, says Frost & Sullivan.
"Governments in Sub-Saharan Africa have come to realise mobile money is key to improving the region's financial inclusion," saysFrost & Sullivan ICT industry analyst Lehlohonolo Mokenela. "Consequently, they are looking to create an enabling environment for [mobile network operators] to deliver mobile money services for the large unbanked and underbanked population."
Nonetheless, the volume of mobile money transactions will be kept in check by the lack of interoperability between operators' solutions and restrictions on cross-border transactions, says the research house. It adds that concerns about the security and reliability of mobile money solutions, particularly in markets with intermittent network access, will also challenge market development.
Frost & Sullivan notes service providers need to increase their mobile agent networks and enter into partnerships with other providers in the ecosystem, to fuel the uptake of mobile money services.
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