Mobile Money covers 16% population in sub-Saharan Africa (Africa)
Money transfer via mobile phones has expanded to 16 percent of the total population in sub-Saharan Africa, according to a new World Bank study, as reported by Mobile Money Africa. The Global Financial Inclusion Database, or Global Findex, has found only 3 percent of the population in the rest of the world take advantage of money transfers through mobile phones.
As per the report, in sub-Saharan Africa, take-up of mobile money services, pioneered by Kenya-based Safaricom’s M-Pesa service, has been boosted by the fact that traditional banking is hampered by transportation and other infrastructure problems.
A statement issued by World Bank claims that money transfers through mobile phones is a form of increasingly nontraditional banking that often doesn’t require users to travel or set up an account at a brick-and-mortar bank. Further, such mobile banking allows account holders to pay bills, make deposits or conduct other transactions via text messaging. Kenya, where 68 percent of adults report using a mobile phone for money transactions, has seen particularly impressive growth in this market.
As revealed in the report, said Asli Demirguc-Kunt, the Bank’s director of development policy and chief economist of the Finance and Private Sector Network, said that nearly two-thirds of the unbanked cite poverty as the obstacle to financial access, but about a third also blame the cost of opening and maintaining an account or the bank’s being too far away, which means long bus rides for many.
In markets like Uganda, mobile money transfer services have become a revenue generator, with players hotly competing for users as margins on voice services have been driven down over the years. MTN Uganda, for example, has more than 2 million registered customers after launching in March 2009. MTN reported recently that US$100 million gets transferred over the service every month.
The four mobile money offerings in Uganda including MTN Mobile Money, Airtel Money, Warid-Pesa and Uganda Telecom’s M-Sente are largely similar, allowing registered users to load money into their accounts, make transfers to other users, buy recharge vouchers as well as withdraw money.
Vodacom eyes acquisition opportunities in Africa (Africa)
South African cellphone operator Vodacom Group Ltd. said that it is ready to grow its operations further across Africa and is on the hunt for small acquisitions.
Chief Executive Pieter Uys told DJN that they feel more comfortable that they have the recipe to be successful outside South Africa. Uys said the company is looking to make smaller acquisitions in the $100 million range focusing on a few countries on the continent that provide a stable political environment, big city populations and which aren’t overcrowded with other mobile phone operators.
As per the report, the key to expansion, Uys said, will be to establish a local presence in each country. When the company first expanded, Uys said it would put together packages in its home base of South Africa and then carry them out to the other countries it operates in–Tanzania, Mozambique, Lesotho and Congo. He added that Vodacom is considering expanding into Angola, Ethiopia and Uganda.
While telecommunications companies in Africa are benefiting from the expansion of its user base as more people enter the cellphone market, that growth doesn’t come without complications.
Vodacom is battling a court case over its 51 percent shareholding in Congo after a former consultant for the company took it to court over a payment dispute. Congolese courts ruled that Vodacom is liable to pay the company, Nememco,$21 million, and said if the company doesn’t settle the payment, the courts will conduct a public auction of its shares in Vodacom Congo on June 3.
Total Vodacom customers rose to 47.8 million for the year ended March 31, up 11 million from the previous year. In South Africa, customers rose by 6.1 million to 28.9 million.
Airtel‘s East – African e-money connection (East Africa)
As part of a business expansion, Bharti Airtel is aiming at East Africa as a potential market for growth. Being functional in 16 African countries, Airtel is planning further expansion in an attempt to avail the benefits of increased trade in East Africa, due to the launch of the common market in 2010. The company opined that the e-money service will make the money transactions hassle free for businessmen by saving their time, usually wasted at bank queues.
The company is optimistic about its East African venture on the grounds of its partnerships with East African international and regional banks. Partnerships with financial institutions have enabled Airtel to work efficiently towards providing banking services, money transactions and payment of bills, among others.
Kick starting the business in Africa, Airtel launched its e-money service and mobile money platform in Uganda, allowing customers to withdraw cash through ATM’s. Airtel’s mobile money platform will serve various purposes like ATM transactions, airtime top ups, etc.
The company is planning to embark its presence in countries like Kenya, Tanzania, etc. Including Airtel, there are almost four operators in the e-money business in East Africa. Thus, for a stronger foothold in the market, Airtel is aiming to launch the e-money transactions amongst Uganda and its neighbouring countries.
Bharti Airtel contemplates mobile service launch in South Africa and Cameroon (Africa)
India’s leading telecommunications operator Bharti Airtel may be planning to expand its network in South Africa and Cameroon, as learned through industry sources. Airtel is a dominant player in the mobile industry with operations in 19 countries across Asia and Africa.
Mobile penetration has steadily been increasing in African countries, and with most of the global markets being saturated, emerging markets such as Africa provide mobile operators with new opportunities to increase their subscriber base and enhance their revenue.
Currently Airtel offers services in Nigeria, Burkina Faso, Chad, Congo Brazzaville, Democratic Republic of Congo, Gabon, Madagascar, Niger, Ghana, Kenya, Malawi, Seychelles, Sierra Leone, Tanzania, Uganda and Zambia. By adding South Africa and Cameroon, two of Africa’s fastest growing mobile economies to the list, Airtel aims to strengthen its position in Africa.
Airtel is the leading mobile operator in India and is well known for its innovative and competitive tariff pricing. The operator’s entry into these new markets is expected to take the mobile industry by storm and introduce an unprecedented level of competition.
Airtel presently offers services in 15 cities in India and with the population of one Indian city being similar to that of one African country, South Africa and Cameroon have the potential to be extremely lucrative for Bharti Airtel.
Further, sources claim that rival operators currently offering services in these economies such as MTN, Vodacom and Orange are already working on strategies to maintain their market share and offer stiff competition to Airtel.
MTN Uganda and American Tower to form joint venture (Uganda)
American Tower Corporation, a leading provider of wireless and broadcast towers worldwide, is reportedly planning to start a joint venture with MTN Uganda. According to reports, the joint venture titled ATC Uganda will acquire as many as 1,000 mobile data towers of MTM in Uganda at a price of US$ 175 million.
Further, sources suggest that American Tower is expected to have a 51 percent stake in the new venture with MTN controlling the remaining 49 percent stake. Reports reveal that Jim Taiclet, CEO and Chairman, American Tower has said that their strategy is to invest in select African markets with strong wireless growth potential and a positive investment climate. As per sources, the joint venture is expected to add 280 new towers for MTN Uganda in the next three years.
Uganda government to renew licence based on Quality of Service (Africa)
Uganda’s telecom companies have reportedly been issued a warning that the licence renewal applications will be considered on the basis of the quality of service (QoS) offered. According to reports, Nyombi Thembo, State Minister (Information Technology), has said that there is no way they will renew a licence for a player offering poor services. He added that the government’s aim is to guarantee value for money by driving improvements in the quality of the services offered to the customers.
As per sources, the report on QoS released by the Uganda Communication Commission last week reflected the poor performance of all the mobile network operators in the region wherein all six operators exceeded the maximum 2 percent rate of calls blocked or dropped. A blocked call is a failed call attempt due to network failure, where as a dropped call is one which gets connected successfully but is terminated ahead of time by the provider. MTN Uganda had the highest number of blocked at 11.1 percent while Airtel Uganda had the highest number of blocked calls at 15.2 percent.
MTN and Visa offer new m-payment services (Africa)
South African operator MTN has reportedly tied up with Visa in order to provide m-payment services to unbanked users in emerging markets. According to reports, the service, known as Visa Mobile Prepaid, will be initially marketed in Nigeria and Uganda, as part of its existing mobile wallet service.
As per sources, Aletha Ling, COO, Fundamo (Visa) said that the service provides users with a new set of transaction options such as withdraw money from ATMs, transfer money, and pay bills as though they are using a typical card. She added that customers will not be able to use the product if there is no money in their mobile wallet, similar to a debit card, which is why Visa is describing it as ‘prepaid’.
Ling also said that they provide the solution to operators as well as the banks. Operators, in partnership with a bank, will be able to offer this feature as a value-added service under their brand.
MTN Ghana, Yemen and Uganda implement International Airtime Transfers (Africa)
Africa’s leading telecommunications operator, MTN Group has reportedly begun the implementation of its International Airtime Transfer (IAT) in partnership with TransferTo, a global airtime remittance hub that interconnects mobile operators’ prepaid systems, enabling the transfer of small amounts of value in the form of prepaid mobile credits.
According to reports, the partnership will provide MTN customers access to prepaid services so as to receive airtime transfers from the TransferTo IAT network around the world. Sources suggest that currently MTN’s companies in Uganda, Ghana and Yemen have integrated their operations with TransferTo, with other MTN operators expected to follow soon.
As per sources, the airtime services will enable all TransferTo partners along with the general public abroad, to send top-ups to MTN users in Ghana, Yemen and Uganda. Further, mobile users on partner networks will be able to use their handsets to send airtime to MTN prepaid customers, while those who haven’t yet subscribed to TransferTo can do the same via its website.
Bharti Airtel signs deal with Nokia to expand 3G services in Africa
Bharti Airtel, a leading telecom operator has signed a contract reportedly worth $ 700 million with Nokia Siemens Networks to expand its 2G network and deploy and manage 3G services in Africa.
As per the agreement, Nokia Siemens Networks will manage all network operations as well as provide energy-efficient base stations for Airtel in seven African countries including Madagascar, Malawi, Zambia, Tanzania, Kenya, Uganda and Congo Brazzaville. In an attempt to increase its subscriber base, Airtel has been expanding its presence in Africa’s rural regions.
According to reports, Manoj Kohli Airtel’s CEO (International) and Joint Managing Director said that this partnership will further enable them to rapidly expand their network coverage and provide high-speed wireless internet connectivity to their customers. Further, Nokia Siemens Networks, Chief Executive Officer, Rajeev Suri said that they look forward to working closely with Airtel to expand its network rapidly and deliver the right innovative products and services to help meet user demands.
Airtel plans to suspend communication agreement with UTL (Uganda)
Bharti Airtel plans to terminate all calls made and received from UTL to its Uganda unit, owing to failure of repayment of debts. Uganda Telecom owes Airtel a sum of approximately $3.5 million in outstanding fees and court fines. Sources claim Mr Ruhakana Rugunda, the minister of Information and Communication Technology (ICT), summoned Airtel’s managing director Mr V.G Somasekhar, in an attempt to stop Airtel from terminating these calls.
Airtel had already filed three court cases against UTL in December last year. Reports suggest that Mr Joseph Kanyamunyu, Airtel’s spokesman said the Indian-owned firm will not lift the termination until UTL clears the debt. In the event that communication is suspended between Airtel and UTL, a subscriber base of at least 4.5 million users will be affected on both networks.
