Dar es Salaam. The National Microfinance Bank (NMB) has signed a Memorandum of Understanding (MoU) with Vodacom Tanzania to allow its customers to use M-Pesa services to access their NMB accounts for various financial transactions.
The collaboration between NMB and Vodacom Tanzania is expected to provide a financial solution and a great relief to more than 80 per cent of the unbanked and under-banked communities in Tanzania.
Through the service, NMB customers and non-customers will now be able to deposit their money through more than 40,000 Vodacom M-Pesa agents countrywide directly to their bank accounts.
The initiative comes shortly after mobile phone service providers recorded a robust growth and technological advancement that has enabled both financially disadvantaged and urban communities in the country to have access to banking services through mobile money transfer.
“Through this partnership of strength, NMB will be able to extend its distribution and in turn contribute significantly in improving people’s lives and economy in urban and remote areas of Tanzania,” said the NMB chief executive officer, Mr Mark Wiessing.
The partnership between Vodacom and NMB is one of its kind in the country, in which the two institutions have been playing a leadership role in subscriptions and market share.
The MoU will now see NMB extending its services using the more 40,000 M-Pesa agents instead of its only 500 ATMs and 148 branches across the country to reach the unbanked and under-banked communities.
For his part, Mr Jacques Voogt, the Vodacom M-Commerce chief officer, said in order to ensure maximum and efficient transactions through the partnership, all security checks are already in place as stipulated by the Bank of Tanzania (BoT) through the Know Your Customer (KYC) policy.
“This is yet another milestone that we are marking today. Vodacom is extending its M-Pesa agent network to NMB and by so doing allows NMB customers to deposit money conveniently into their bank accounts –as well as enabling withdraws from the bank directly into the M-Pesa ‘wallets’,” said Mr Voogt.
He noted that the minimum sending of money through the service will be Sh500, 000 and a maximum of Sh1 million withdrawals, but there are still some logistics being worked out on how to increase the prescribed amount.
The open electronic payment system can spur growth by enabling new types of transactions, including person-to-person payments, e-commerce, and transfer payments from government to its citizens.
“Currently, mobile money transactions are no longer limited by closed-loop systems; you can send money to someone else even if they are not on the same system/network. The challenge is getting different mobile money deployments—and the banks behind them—to interact with each other,” he added.