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Posted by MOBILE KWETU Posted on 12:51 AM
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2KUZE gives farmers access to more buyers, enables them to run a more profitable business and paves the way to a cashless agricultural sector
Mastercard today launched 2KUZE, a digital platform that connects smallholder farmers, agents, buyers and banks in East Africa. 2KUZE, which in Swahili means “Let’s grow together,” enables farmers to buy, sell and receive payments for agricultural goods via their feature phones. The platform brings the benefits and security of mobile commerce and payments to farmers in Kenya, Uganda and Tanzania.
Posted by MOBILE KWETU Posted on 2:29 AM
Posted by MOBILE KWETU Posted on 2:27 AM
Much has been written about the potential of pay-as-you-go solar to advance financial inclusion while expanding access to energy among the poor. One of the biggest challenges in promoting digital payments is that often there is not a strong value proposition for customers; people don’t want to switch from cash payments unless there is a good reason. The excitement around pay-as-you-go (PAYGo) solar is that by linking digital payments to useful everyday products or services, like reliable energy, customers have more attractive reasons to adopt and use digital payments. But does the data show this actually happening? New CGAP research in Ghana, carried out in partnership with PEG Africa and Tigo Cash, indicates yes.
To date, there has been isolated evidence that solar payments could drive mobile money use. Fenix International reported that at least 13 percent of their customers registered for mobile money in order to purchase a ReadyPay product, while in Rwanda, Mobisol estimated that 20 percent of their users were newly registered to mobile money services. But there has also been a long-held hypothesis in the industry that PAYGo customers are better active mobile money customers — that by making mobile bill payments on a regular basis, they become more comfortable and active users of additional mobile financial services. Increased usage means higher revenue per active user, making digital finance a more sustainable model for reaching the poor.
Testing this assumption required the right partners. Tigo Ghana is one of the leading DFS providers in Ghana. Its mobile wallet offering, Tigo Cash, has over 3.5 million registered subscribers. Converting them into active users remains an issue, as it does throughout the industry. PEG Africa is a financier of life-changing assets and a leading pay-as-you-go solar company in West Africa. PEG has installed over 20,000 solar home systems, bringing reliable lighting to over 100,000 people in a country where half the population lives off the grid and the other half suffers from unreliable electricity service. And as a business that relies on digital payments, PEG has been actively working with mobile money operators like Tigo Ghana to innovate in the mobile money arena.
CGAP worked with both organizations to compare active Tigo Cash users who are PEG customers with a sample of active Tigo Cash users who are not. The goal was to measure the average revenue per user (or ARPU) generated for Tigo within each sample, giving us a better idea of whether pay-as-you-go solar was really driving uptake of digital payments.
The difference in average revenue per customer was illuminating: PEG customers generated 122 percent more revenue per active user for Tigo Cash than did non-PEG customers in the sample. A significant piece of the added revenue comes from bill payments, which in Ghana are still relatively rare. The last Financial Inclusion Insights Survey, done in partnership with CGAP, revealed that only 5 percent of active mobile money users had made a bill payment, compared with 12 percent in Uganda and 20 percent in Kenya. But within the group of active mobile money PEG customers in Ghana, 34 percent had made a mobile bill payment: much higher than average.
In addition to bill payments, average PEG users had a more varied use history. They checked their balances more frequently, cashed in and out more frequently, and made over three times as many person-to-person transfers per user. All told, 54 percent of active PEG users had made a bill payment or P2P transfer within the study period, against only 18 percent of non-PEG customers.
There are important caveats to these statistics. Only 16 percent of PEG users in the sample were active, compared to 40 percent of Tigo Cash users. CGAP has worked with PEG to develop easier ways for customers to pay digitally, which will hopefully lead to increased active use. And it is certainly possible that outside factors, such as age and income, played a role in creating the ARPU difference, although controlling for those was not possible given the data available.
More research is needed, but it is clear that when PAYGo solar customers use mobile money, they use it a lot. According to Carl Pomeyie, the acting head of Mobile Financial Services at Tigo Cash: “The results reiterate the need to build an ecosystem that allows Tigo Cash customers to pay for services beyond just withdrawals from their wallets. As we [at Tigo Cash] look to build a digital ecosystem throughout Ghana, providers like PEG who provide essential services will be invaluable in stimulating demand and providing a value proposition to the rural customer.”
So what can other operators learn from this example? When building out mobile money infrastructure, it is essential to think about the value for the customer and to partner with someone who offers that “hook.” PEG has become one of the largest bill-pay recipients in Ghana, despite being a relatively new company. In Uganda, Fenix International and MTN are working together to distribute co-branded PAYGo solar units, offering ReadyPay as a dedicated USSD menu option for mobile payments. In Kenya, M-KOPA products are sold out of SafariCom shops, and both organizations recently signed an agreement to facilitate advanced knowledge exchange. Partnerships like these offer tangible value that can only be acquired digitally, giving customers users a reason to not only register for mobile money, but to actively use it.
On a broader level, partnerships between digital finance platforms and more traditional service providers could produce considerable synergies. In 2009, SafariCom and Kenya Power partnered to shift electricity bill payments to mobile channels. Kenya Power is now one of the largest bill-pay recipients on M-Pesa by value. In Cote d’Ivoire, shifting school registration payments to mobile channels helped to develop the digital finance infrastructure. These partnerships do not need to happen on a bilateral basis. Opening up payment and data APIs to external developers could produce a slew of new use cases, each of which may bring more active subscribers onto the payment rails. New and improved service models that leverage digital finance may not be beneficiaries of digital ecosystems, but the cornerstone on which they are built.
Source: Innovation in Africa
Posted by MOBILE KWETU Posted on 12:45 AM
Tanzania is one of the most developed mobile money markets in the world, representing almost a third of all of East Africa’s active mobile money accounts in 2015.  It is also one of the most progressive, with ambitious initiatives regularly leading to new product innovation. Today, we are releasing a publication looking at the impact of one form of innovation coming out of Tanzania: the impact of account-to-account mobile money interoperability.
With Tigo, Airtel and Zantel having connected their services in 2014 and Vodacom integrating in 2016, account-to-account interoperability is still in early days in Tanzania. As such, this publication focuses on preliminary quantitative metrics alongside perspectives and reflections written by the service providers. The basic quantitative data offers a glimpse of initial customer behaviours and allows us to benchmark growth against a comparative use case, the off-net voucher. The latter half of the publication focuses entirely on the perspectives of the providers. These perspectives are critical because the experience of these players will inform both how Tanzania develops and how other practitioners evaluate the opportunity of interoperability in their own markets.
Between the data and the providers, Tanzania has provided more evidence to help all industry stakeholders develop more realistic expectations of and a better understanding for account-to-account interoperability. For example:
- Basic market prerequisites in Tanzania provided the right dynamic for early growth. Growth in Tanzania is promising, particularly given providers have taken a “wait and see” approach in the early days. For Airtel and Tigo, cross-net transactions now exceed off-net vouchers, and both cite double-digit monthly percentage growth. To capture this early organic growth, providers benefitted from (1) an enabling regulatory environment that encourages innovation, (2) strong operational foundations across all providers and (3) a commitment to the user experience, including honouring a consistent price for all P2P transfers – whether on-net or cross-net. Markets lacking these basic prerequisites may risk a harder road before reaping the benefits that interoperability can enable.
- Interoperability between providers can also be a catalyst for further investment in industry collaboration. There is a healthy diversity of perspectives and expectations from providers around the implementation and impact of domestic interoperability. However, what is clear is that the launch of this singular form of interoperability is part of, and in some cases reinforced by, an on-going strategy to capture the benefits of broader industry collaboration. Millicom, Vodacom and Airtel all explicitly expressed an interest to build on their experience and potentially extend interoperability to new use cases, such as merchant payments.
- The impact of interoperability is best measured over the long-term. Mobile money interoperability has further to go in Tanzania before it is close to the transaction volume processed through bank integrations or on-net P2P transfers. To accelerate that growth, the industry continues to explore how improvements to the technological and financial infrastructure could make mobile money interoperability more efficient. New investment in customer campaigns are also underway, and these investments will help evaluate the long-term growth ceiling and the extent of mass-market need for the functionality.
- Source: gsma
Posted by MOBILE KWETU Posted on 2:02 AM
Telecoms company MTN Uganda and the Commercial Bank of Africa have launched a virtual banking platform designed as a credit facility for the unbanked population, and those lacking collateral and credit history, who are locked out of the loans market.
The service requires MTN Mobile Money users to open a mobile bank account on MoKash, into which they can deposit as little as Ush50 ($0.015) in savings, and borrow up to Ush1,000,000 ($293) repayable at a rate of 9 per cent.
In the absence of proof of creditworthiness of the virtual customers, MTN says it will rely on other factors like the consistency of a customer’s usage of services like data and utility payment services to decide the loan amount to give.
The micro loan offer is a result of advancements in technology that have seen mobile money revolutionise the movement of money and the payment systems in the region.
MTN hopes to replicate the success Safaricom has had in Kenya, after it partnered with CBA to launch a similar service, M-Shwari, in November 2012. A rollout to Tanzania was made the same year, where some 5 million customers are currently subscribed to the service.
By March this year, CBA had disbursed Ksh10 billion ($100 million) in loans and collected Ksh8.1 billion ($81 million) in savings from 3.9 million customers.
In Uganda, MoKash is expected to increase financial inclusion for people in rural areas.
According to Prof Augustus Nuwagaba, an economist and lecturer at Makerere University, 68 per cent of Ugandans are not monetised, that is, they do not touch money. Only 8.3 per cent of the population interacts with commercial banks.
In Rwanda, 28.2 per cent of the population interacts with banks.
Movement of money
Uganda is considered to have the highest movement of money in the region, but much of this is in the rural areas through traditional and informal methods of saving like purchase of land and livestock.
“Ugandans have a lot of money that ought to be saved. However, they do not have the incentive to save, and so domestic absorption will be slow,” said Prof Nuwagaba.
There is a need for telecoms companies to expand their networks to distant customers for the delivery of their products. Handsets also need to be made available to potential customers in rural areas, together with financial literacy training in the benefits, security, accessibility and relevance of the services.
Erick Muriuki, the general manager for new business at CBA, said that for a successful cashless economy to be realised, there is a need to digitalise the money velocity in an economy.
This has to start with the reduction of costs incurred when making payments for utilities using digital means.