Several weeks after launching their various mobile services in Nigeria, the mobile money operators licensed by the Central Bank of Nigeria are yet to achieve a complete take-off of their operations. The wobbling beginning has been traced to paucity of agents’ network and low awareness about the emerging services. KUNLE AZEEZ reports.
The issuing of mobile payment operational licences to about 16 companies to roll out mobile money services in Nigeria by the Central Bank of Nigeria has been described as a welcome development aimed at promoting financial inclusion in the country.
According to statistics, many Nigerians currently do not have access to bank accounts given that about 79 per cent of Nigerian population is unbanked. This means that only 21 per cent of Nigerians have bank accounts. In line with its vision of promoting electronic payment transactions and subsequently driving the nation's cash-lite economic policy, the CBN last year issued mobile money licences to create another avenue for Nigerians to carry out their businesses without carrying cash around. Indeed, the motivation to develop mobile payment system in the country, follows the bourgeoning telephone subscriptions on telecoms networks which, according to the latest industry data released by the Nigerian Communications Commission, telecom industry regulator, now stood at 95.8 million as at December, 2011.
Since mobile money involves the transfer of money from one mobile phone to another without any need for a bank account, the CBN had thought that the scheme would be a game changer expected to make significant impact on the country's financial and e-payment landscape in 2012 and beyond. Some of the mobile money operators licensed by the CBN include UBA (Afripay), GTBank, Ecobank, IBTC Stanbic Bank,Monitise, Corporetti Support Services.
Others are Hendomark, Pagatech, Eartholeum, First Bank, ETB, Fortis Microfinance Bank, eTrazact, Chams, Paycom, and M-Kudi. However, while some of the telecoms operators namely Globacom and MTN Nigeria have opened their networks platforms for mobile payment operators for providing their m-payment services, with some of the operators such as UBA, Fortis, Pagtech, eTrazact, Ecobank and Stambic IBTC rolling out their services in December 2011, National Mirror's market survey has revealed that some of the operators are still facing a major problem of inadequate agent network.
Experts say that inadequate distribution and agency network will constitute strong road block to the system, if not urgently and properly addressed. Investigations revealed that in countries where mobile money scheme has succeeded, the requirement of building a robust agent networks has been central to success.
In Nigeria, it has been said that over 50,000 agents, who will serve as human Automated Teller Machines, doin g cashin and cash-out across every nooks and crannies of the country, for the million of financially-excluded Nigerians to significantly feel the impact of the mobile money revolution, would be required. However, investigation reveals that in spite of their targets to build a robust network of agents that will service as their representatives in different locations across the country, all the mobile money operators combined currently have less than 1,000 verifiable agents nationwide. The Principal Associate, Mobile Money Africa, Mr. Emmanuel Okoegwale, who confirmed this to National Mirror while lamenting that 1,000 agency points are grossly inadequate for the mobile money system. According to him, The agency network that should make mobile money happen in Nigeria is not there now and this can affect the success of the mobile money system.
In Nigeria today, we have less than 1,000 verifiable agents while in Kenya, there are 22,000 agents and 54,000 in Brazil. One of the problems, Okoegwale said, is that mobile money operators are struggling to build individual agents network rather than developing the agency network together and competing in the area of marketing, which saves time and resources. Okoegwale said the approach developing agent network together is similar to the collocation services being advocated by the NCC for telecoms operators whereby operators can share their base stations to provide services rather than building individual base stations across the country, which cost them more in terms capital expenditure and takes time.
Speaking, the President of Medallion Communications, Mr. Ikechukwu Nanamai, said since building a robust agency network is the beck rock of mobile financial services and the, It would be necessary to source, develop, train and deploy agents on a shared basis to improve viability. Some bank customers who spoke with National Mirror expressed concern that the mobile money services are not yet working in the country.
One of them, who gave his name as Mr. Olusola Banjo, said I have not subscribed to the service but I think lack of adequate agents to liaise with when using the service to transfer monetary value on our phone is a major challenge now. Others blamed the vague take-off of the exercise on poor awareness creation on the part of the licensees while some others, who already have the mobile money account with their banks, say the services was not functional yet. I already have the mobile money account from my bank since last year, but I dont think it is working.
I just dont know what do with if I carry money on my phone and I dont have anybody to send it to and where many people dont have mobile money account, it also becomes a problem for you to spend the money on your phone, says a bank customer, who pleaded anonymity. It was, however, learnt that operators are currently leveraging the Nigerian Postal Service, through its wide network, to boost mobile money penetration in the country.
The new arrangement to develop a robust national agent networks that mobile money operators can tap into on the platform of NIPOST was announced recently by the Minister of Communication Technology, Mrs. Omobola Johnson during an interaction with the media in Lagos.
NIPOST is the dominant operator and regulator of the countrys postal sector with a network of 1,065 post offices and more than 3,000 additional postal agencies distributed nationwide in 547 of the 774 local government areas in Nigeria.
According to the minister, the extensive network penetration into rural areas and the variety of services offered have enabled NIPOST to serve as a tool for the promotion of social, financial and digital inclusion.
NIPOS will play a critical role in financial inclusion in Nigeria, the minister had said. However, NIPOST faces substantial competition from private sector operators in the postal sector. About 250 courier firms have been licensed and many transport companies (legal or illegal) are active in the postal market.
Consequently, NIPOST has signed agreement with nine of the licensed mobile money operators to provide its over 4,000 post offices and postal agencies platforms for mobile money services. Also, with NIPOST in the forefront, the postal organisation is working with One Network, an industry stakeholder organisation including the payment switches, financial institutions, insurance companies and system integrators, among others.
The Programme Director, One Network, Mr. Adesola Bickersteth said the organisation is working with NIPOST to develop the implementation framework that will be used to redefine who a postal agent is.
The aim, according to him, is to transform the postal agent from just selling postal stamps and money order to carrying Point of Sale devices and service terminals for providing financial and citizens services to their communities. He said the actual target is to build about 150,000 (1 per 1,000 citizens) over the next three years, adding that O ne Network is working with necessary stakeholders such as microfinance and other banks, the National Directorate of Employment, CBN, associations and cooperatives, local and state governments as consortium with a target of 50, 000 agents before the end of 2012.
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