Mobile Money Monitoring solutions ensure transactions foster financial inclusion in African countries

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Nigerian mobile phone customer numbers have grown rapidly over the past ten years as handsets have become more affordable and data services have increased. Nigeria is Africa’s most populous country and had 151 million subscribers at the end of last year, up from 19.5 million in 2005—an exponential increase.

Pursuant to its responsibility of promoting a sound financial system in Nigeria and according to the Central Bank of Nigeria (CBN) Act of 2007, Nigeria’s Central Bank is mandated to promote and facilitate the development of an efficient and effective system for the settlement of transactions, including the development of electronic payment systems.

The introduction of mobile telephony in Nigeria, its rapid growth and adoption and the identification of person to person payments as a practical strategy for financial inclusion has made it imperative to adopt the mobile channel as a means of driving the financial inclusion of the unbanked in the country.   Mobile Money transactions are proving to be very popular in other emerging countries and Mobile Money grows exponentially once it takes off in any country.  It would be prudent for the Central Bank and the Nigerian telecoms regulator, the National Communications Commission (NCC) to be prepared for this explosion by having the necessary regulations in place.  Not only the regulatory framework but systems to allow the regulators to implement the regulations and monitor compliance.  These factors underscore the decision of the Central Bank of Nigeria to issue guidelines for the creation of an enabling environment for the orderly introduction and management of mobile money services in Nigeria.

Tanzania, like Nigeria, has also witnessed strong growth in telecommunications and in approximately five years, an unprecedented uptake of mobile financial services. Its success is attributed to the conducive regulatory environment which the Tanzanian government, regulatory authorities and the Bank of Tanzania envisioned in the very early days of mobile money services. Tanzania’s regulatory approach of “mandate and monitor” has ensured that mobile payment regulations are issued to guide the market without stifling innovation or disrupting the successful development trajectory.  In this way, financial stability and financial inclusion objectives have been balanced.

Tanzania has recognised the role of mobile money in “revolutionising the landscape of financial services.”   In line with these developments, it is now not only the first country in the entire East African region, but also the first country in the world to have deployed a mobile financial services monitoring tool.   This is an example of a country preparing for good governance over the growth in the MM sector.  A mobile financial services monitoring solution gives government and the regulatory authorities visibility on all mobile money transactions to safeguard the efficiency and safety of mobile money, to protect the mobile money market and users, and also to enable better planning of the cashless economy.  Most importantly of all, perhaps, it will also limit the risk of fraud, money laundering and the financing of terrorists.

A Mobile Financial Services Monitoring solution—an essential tool for governments and regulators— could be of very real benefit to other African countries seeking to regulate the mobile money environment and mobile money transactions.

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The Author – Gwyneth Rose is a communications consultant and writer for media.  Gwyneth’s passion is to write about solutions on how African countries can stimulate their economies through the use of innovative finance and cutting edge technology.  She is passionate about African politics and what drives policy making.

Email:  journalistsink@gmail.com

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