Mobile money interoperability and the banks

Two weeks ago, Vice-President Dr. Mahamudu Bawumia launched the much-awaited mobile money interoperability which now allows the transfer of money from one mobile money account to another, irrespective of the telecom operator.

This means you no longer need to go through a third party like an agent or the myriad of mobile money application and payment platforms. If you are on MTN and you need to send money to an AirtelTigo client, you can send it easily from the comfort of your seat in the house, the office or even in a car.

The added bonus is the seamless transfer of money from a mobile money account to any bank account and vice versa. This is more good news.

Hitherto, banks without a robust mobile banking platform saw their customers visit the banking halls and withdraw money, visiting an agent before placing the money in the mobile money wallet. If you are lucky and the bank offers mobile money services, then you can easily deposit the money in your wallet in the banking hall.

But with interoperability, everything can be done from a single source: the mobile phone. What does this mean to the banking industry?

First, the hope and vision of banks to reduce the number of branch visit becomes more of a reality than a dream. With mobile applications and payment platforms owned and managed by some banks, customers already use these platforms and no longer need to visit the branch regularly.

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Ecobank App, for example, has over 1 million downloads, and at least a 50 percent active user base. That means a huge chunk of the bank’s clients no longer visit the banking hall for withdrawals, deposits and transfer of funds.

With interoperability, it becomes more convenient for the bankers and customer. Instead of moving the funds from a bank account into an MTN mobile money wallet, for example – visiting an agent to transfer to AirtelTigo wallet, customers can do all that seamlessly. That is the convenience the banks are hoping to offer their clients.

Secondly, what this means is that banks with less customers visiting their branches can redirect the cost of operations to enhancing, securing and protecting their technology to better serve clients. Instead of opening new branches or maintaining old branches, these branches can be closed or staff significantly reduced, and that new cost can be redirected into the continuous development of their mobile applications or mobile banking platforms to better serve clients.

To the client, it is a smooth ride in life. One no longer needs to add a visit to the branch on a daily, weekly or monthly basis to the ‘to-do-list’. With the money in your hands – the mobile phone – you can effect a transfer from the bank account to your wallet anytime and pay directly for services rendered.

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Paying bills, paying for goods and services rendered should no longer be a question of which mobile network are you on, but a matter of “give me your number so I transfer the money into your wallet”.

For government and the revenue office, payments can be tracked and revenue generation for government can easily be tracked and the right taxes

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