The consumption habits, lifestyle and needs of African populations have evolved since the democratization of the Internet. These different factors imply a change in the traditional approach of the financial sector in Africa. This change is reflected in the emergence of mobile payment solutions and the rise of many applications. So what are the different existing solutions?
West Africa: a region that is lagging far behind
Banking establishments in the Franc zone now operate by applying classic models of operation: bank points, branches, offline communication through television and billboards. The profound changes brought about by the use of the Internet call for a change.
Why have mobile applications not developed more in markets where more than 200,000 people connect to the Internet each month and have mobile phones?
This reality concerns African countries in the French-speaking area. Conversely, the English-speaking countries, and in particular Nigeria, are calling for the establishment of a “cashless society”, a society in which money is dematerialized.
Mobile banks in East Africa provide support to the branch network, which is generally insufficient, and help them cope with customer pressure. Meeting at the World Economic Forum (WEF) in Davos, international financial experts announced a total digitization of African banks by 2030.
Towards innovative mobile solutions?
The weight of mobile phones and their impact on everyday life in Africa is significant. From now on, it becomes essential to set up an electronic wallet by allowing everyone, using a series of codes, to carry out transactions quickly and easily.
When Canal + associated its renewal platform with existing “mobile money” solutions in Africa, subscribers noticed a simplification of formalities. The first challenges to take up? The gradual replacement of SMS portals with more responsive, user experience oriented USSD portals.
The second challenge to be faced is the digitization of all customer services, from requesting a checkbook to transferring funds or even the possibility of making day-to-day payments.
The aim is to simplify the “mobile money” approach by giving the financial sector a right of scrutiny which it tends to lose to the benefit of mobile operators. However, there is the problem that telephone operators may face, namely: that their offers are associated with those of banks instead of being an extension of them.
Offer a structured framework
Faced with the interdependence to which banking establishments and mobile telephone operators are subject, one cannot function without the other, it is imperative to supervise this market.
Unlike mobile network operators, currently only banks have the authorization to issue electronic money. Indeed, a small minority of operators have a mobile banking license, which pushes them to have to turn to bank branches to enter into partnerships.
This reality does not promote the development of the “mobile money” market. However, within the WAMU zone, the Central Bank of West African States has confirmed that it is ready to grant the telephone operators the license allowing them to no longer be dependent on an establishment. This proposal seems to have gone unheeded.
Despite complex regulations associated with declining turnover, mobile network operators increasingly want to move towards the “mobile money” model. Faced with the digital revolution that is increasingly taking place in Africa, regardless of the sector of activity, it is essential that banking institutions rethink their business model. This must now take into consideration the new ecosystem in which they evolve.
Existing “mobile money” solutions towards a new form of payment?
Currently, there are many solutions for financial transactions or payment for goods and services such as Wari. However, Wari’s offering is currently undergoing an evolution. Indeed, following the partnership established with Mastercard in early 2017, the company is targeting a new market: that of electronic money for 35 African countries.
As for Kenya, the m-Pesa, a means of payment set up by Vodafone, has met with great success.
The WeCashUp application that allows you to shop online or offline and then pay using a mobile phone in a reliable, secure and low-cost way created by the Cameroonian start-up Infinity Space seems to be the solution. from the future. Indeed, users are not required to have a card or bank account to use this solution.
As long as mobile phone operators fail to free themselves from the supervision of banks, the development of “mobile money” solutions, solutions most suited to the African context, will not take place.