Nigeria Content Online

There is compelling need for financial services firms to explore
mobile money services in order to reach out to more unbanked Nigerians.

Emmanuel Okoegwale, principal consultant at MobileMoneyAfrica, a
mobile money services company, said the challenge of rolling out new branches
has made it imperative for banks to explore the new channel.

“The prospect for mobile financial services is significant in a
country like Nigeria where only 25 million of the 70 million adult population
have access to banking services,” Mr Okoegwale added. He said the
infrastructural needs to roll out mobile money lies with the mobile network
operators despite the fact that the licences were issued to financial
institutions and independent providers only.

He said the mobile payment regulatory framework issued by the
Central Bank of Nigeria (CBN) which has been in use in the last 24 months does
not adequately spell out liaison between the Nigeria Communications Commission
(NCC) and the CBN on enforcing compliance by the network providers. “Post
licencing period will expose some of the land mines in the regulatory framework
and potential lapses but since no framework is carved in stone, I believe the
regulator will take note and ensure positive changes.”

He expressed concern about enforcing certain aspects of the
framework on the Mobile network operators through the NCC. ‘’How do you force
MTN for instance, to open its network for independent providers when it already
has its preferred partners”? Already, the Central Bank has issued licenses to
16 firms to operate in the mobile money business.

Jibril Aku, Managing Director, Ecobank Nigeria, said embracing
mobile banking facilities will aid the gradual migration to cashless society
and also reduce cost of cash handling. In a statement recently, Mr Aku said
mobile banking payment solution will help bridge the gap between the over 64
million unbanked and the over four million under-banked Nigerian adults.

Pieter Verkade, MTN Executive of MobileMoney, said recently that
it has reached agreement to introduce international mobile remittance services
in the 21 countries where MTN operates. Nigeria remains MTN’s largest market
with subscriber base of over 20 million.

No role for Communication
Commission

Reuben Morka, NCC’s spokesperson said the commission has no real
role to play in the sector as the CBN is the regulator granting the licences.
“It is not our business to begin to regulate how banks relate with telecoms
companies on this. We licence telecoms companies but banks are seeking
solutions and they approach any company of their choice.” The Central Bank in
its framework for mobile payment services identified three models for the
implementation of mobile payments services.

These are, bank -focused- financial institutions as lead
initiator, bank led-financial institutions and non-bank corporate organisation.
According to the framework, “The lead initiator shall be responsible for
ensuring that the various solutions and services within a mobile payment system
meet the entire regulatory requirement as defined by the Central Bank of
Nigeria.”

This framework makes banks legally responsible and accountable to the
Central Bank of Nigeria and the end user.Enhancing Financial Innovation and
Access (EFInA), a non-profit organisation promoting access to financial
services for the unbanked and financial sector development said Nigeria lags
behind South Africa, Botswana and Kenya in terms of the percentage of the
population who are financially served. Its claimsin 2010 that, “the growth in
financially served population in many of these markets is mainly attributable
to their mobile money offerings.”