Stakeholders have lamented the current doldrums in which the mobile money operators (MNOs) have found themselves, despite the promise and enthusiasm that attended the launch of mobile payment in Nigeria four years ago and suggested the way out.
According to New Telegraph findings, while other electronic transaction platforms continue to record traction, mobile money service is still struggling to gain a foothold in the country. Experts noted that the huge potential market size for mobile money was expected to have grown to an estimated N1.1 trillion by 2015.
The Central Bank of Nigeria (CBN), as part of its policy to bring the unbanked into the fold of formal banking system, launched mobile money service in 2011 and so far, 21 organisations, bank and non-bank, had been issued with operating licences. Industry experts and analysts, who spoke with New Telegraph in separate interviews, said that the lull in mobile money operations set in because banks, mobile money operators and other players have failed to clearly define, articulate and communicate the benefits of using the service to prospective customers.
They analysts also identified regulatory issues, absence of interoperability amongst disparate mobile money systems, and poor agent networks, as some of the drawbacks to the speedy adoption of the service. Speaking with New Telegraph in a telephone interview, the Chief Executive Officer and Executive Secretary of the E-Payment Providers Association of Nigeria (E-PPAN), Mrs. Regha Onajite, said that the licensees had not been collaborating, especially on agent network.
“One thing we have noticed is that most of the licensees have busied themselves building their respective agents in silos, resulting in limited operation and coverage and lack of visibility and resultant lack of scale,” she said. Regha traced the passive nature of MNOs to lack of robust national mobile network agent across the country. According to her, “at the beginning, we advised the licensees on the danger of operating in silos, but they could not see the hand-writing on the wall.
So, the market is there, but the potential huge market has been eluding most of them.” In 2015, Nigeria’s electronic payments sector recorded over N35.5 trillion transactions across various electronic payment platforms, according to Electronic Fact Sheet released by the Nigerian Interbank Settlement System (NIBSS).
The transactions were carried through the Nationwide Cheque Truncations Services (NCTS) platform, (NEFT), NIBSS Instant Pay (NIP), the Electronic Bills Payment (E-billspay), Point of Sales (POS), Automated Teller Machines (ATMs) and MMOs. Of the N35.5 trillion transactions, only 15.15 million valued at N159.0 billion were carried out on MNO platforms.
Also speaking, Chief Executive Officer, Medallion Communications, Mr. Ike Nnamani, said that majority of the mobile money operators have remained largely invisible in their operations due to ‘insufficient capital and lack of industry knowledge.’ According to him,
“Since mobile money was introduced in Nigeria in 2011, there have been reservations, ambivalence and criticism of the efficiency of the MNOs in the payments ecosystem, with most critics citing insufficient capital and lack of industry knowledge by the MMOs as a big challenge.” Also speaking in an interview, NIBSS’ CEO, Mr. Adebisi Shonubi, said that the non-bank mobile money operators licensed were losing focus on reason for granting them operating licences.