MOBILE MONEY PAYMENT MAY PHASE OUT ATM
Mobile money was also introduced with the aim of reaching the unbanked especially in the areas where ATM cannot be deployed.CBN granted approval in principle to 16 operators in 2010 to roll out mobile money networks across the country. Through the networks, customers will be able to use their mobile devices to send and receive monetary value from agents across the country.
The companies that were granted licences are Pagatech, Ecobank Plc, Fortis Micro Finance Bank, United Bank for Africa Plc/Afripay, Guaranty Trust Bank Plc/MTN and First Bank of Nigeria Plc.?Others are Stanbic IBTC Plc , Paycom, M-Kudi, Chams, Eartholeum, e-Tranzact, Parkway, Monitise, FET and Corporeti.?They were expected to have put in place technological infrastructure and wide agent networks to actualize the mobile money system in the country. Although, the four-month pilot periodn April 30, and the companies are now expecting their permanent license from the CBN in a couple of weeks.
Experts have agreed that there is every possibility that mobile money business may phase out ATM in the nearest future. According to the Chief Executive Officer, Pagatech, Mr. Tayo Oviosu, the CBN has lots of new policies and regulations that is driving towards more of a cash less society and getting more unbanked people.
'I think mobile money is the right force in achieving this and statistics show that close to 80 per cent of Nigerians do not have access to formal financial services, which include savings account, insurance or easy and safe way to transfer money to their loved ones. All these things point to why we got interested in mobile money because there is high mobile phone penetration'.
Telecoms operators have lots of money to make from mobile money because people will send SMS ,make calls and use their data services. It is clear to them that they have to upgrade their network. They should ensure that their customer service works the way it should. We have designed that network in such a way that despite the poor network, our network would still work perfectly.
The Principal Associate, Mobile Money Africa, Mr. Emmanuel Okoegwale however pointed out that there is no way that ATM could displace by mobile money business.
'Mobile money cannot displace ATM instead it will help with the penetration and adoption.ATM provides cash out points for mobile money and as we speak mobile money providers are integrating to interswitch quickteller.Mobile money and ATM are complimentary and I don't see conflicts in short term or future', he said.
Okoegwale, also explained further that with an average roll out budget for technology, marketing and agency network of close to $3m in the first year, there was the need for concerted efforts from the regulator, government and international development agencies to provide the much needed support for the mobile payment service providers. This, he said, was necessary bearing in mind that the ultimate purpose of mobile financial services was to reach the under-banked and underserved communities that were currently not served by formal financial services. 'The relevance of the mobile money system in a country of over 150 million people with a little over 22 million bank accounts, Okoegwale, said, 'Mobile money will make sense in communities where formal financial services are lacking.'
On the issue of security, Paga Co-Founder, Head Sales and Distribution, Jay Alabraba hinted that security as you know is not black or white , saying, ' It is about creating ways to curb fraudsters from gaining access to other peoples account. One of such avenues is by transacting a business with a PIN number, which is known to only the individual. Every transaction done by individuals if the rules are not flouted is safe. There is every possibility of that but an individual must know one or two things about himself before transactions could be completed.
'Security is paramount to us and our technology team has skills in building security for systems. Security will continue to evolve because as new ideas come up on the hackers side, we would have taken two steps ahead. Now, the Java applications with our agents and only one person can log on to that account now. No personal information would be saved on mobile phones and gate keepers would always be on ground to monitor transactions in case of fraud. There is intelligence in the security system that we have.
'There is every possibility of that but an individual must know one or two things about himself before transactions could be completed. Security is paramount to us and our technology team has skills in building security for systems. Security will continue to evolve because as new ideas come up on the hackers side, we would have taken two steps ahead. Now, the Java applications with our agents and only one person can log on to that account now. No personal information would be saved on mobile phones and gate keepers would always be on ground to monitor transactions in case of fraud. There is intelligence in the security system that we have'.
Oviosu also added that the company has spent lots of time in key region of the country to look for credible agents for the system.
'Our key locations are Kano, Onitsha and Lagos. The process to identify agents are systematic,we have what we look out for like the kind of business they are doing, because an agent on Paga earns a commission at every transaction. It is important that they have existing businesses that could attract customers traffic .So that Paga could be seen as add on business to what they do. All our agents have a unique six figure identifier .It is also critical that the agents have the float or working capital to do business because the way Paga is designed, the agent has to invest more to be able to do transactions'.