MTN money

The World Bank Global Financial Inclusion (Global Findex, 2014) figures indicates that Two Million people representing 38% of adults in the world do not use formal financial services.
And 73% of poor people are unbanked because of costs, travel distances and often- burdensome requirements involved in opening a financial account. Three years ago the figure was 2.5 million adults globally.

MTN moneyThis represents a 20 percent decrease in the number of people who have access to formal financial services.

Speaking at the Mobile Money’s Stakeholders Workshop held in Accra, the Chief Executive Officer of MTN Ghana Mr. Ebenezer Asante, noted that it is in this regard MTN Ghana decided on the theme , maximizing the potential of mobile Money to drive financial inclusion in Ghana.

However, he described Financial Inclusion as the delivery of financial services at affordable costs to sections of disadvantaged and low-income segments of society

He cited the following benefits under financial Inclusion: It promotes faster economic growth. There is macroeconomic evidence to show that economies with deeper financial intermediation tend to grow faster and reduce income inequality –

It also promotes economic empowerment. Research shows that financial inclusion can result in women’s economic empowerment-

It brings about improved access to financial products and services at a cheaper cost-
It has many direct benefits to deprived households that are using loans or savings to accelerate consumption, absorb shocks such health issues , or make households investments in durable goods, home improvements or school fees.

According to him, moble money therefore represents an unparalleled opportunity to deliver a basic suite of modern financial services to the “unbanked ” millions across the world.

“The World Bank predicts that by 2020 , mobile money could impact the lives of some 2 billion people in developing countries, heralding a new era of financial services where banking will no longer be the privilege of a a small upper class. The mobile revolution, which has already reached millions of the world’s poor , may well be the vehicle for economic growth”, he said.

Mr. Asante, said in Ghana, financial inclusion has improved by 61% from 2010 to 2014. Whereas access to banks rose 9% and access to informal mechanism fell by 60%. Adding that, Mobile Money had the greatest increase in access , rising from 7% to 20% within the period.

“The contribution of MTN Mobile Money to this increase cannot be overemphasized. As the NO. 1 Mobile Financial Services provider in Ghana, MTN continues to lead in innovation and growth of Mobile Money services in Ghana”, he noted.

According to him, since its launch in 2009, MTN Mobile Money has grown from a subscriber base of about 5,000 to 4.8m as at the end of July , 2015. The service now boasts of monthly transaction volumes in excess of 18.5 million. “As I speak , there are over 19,500 MTN Mobile Money agents as compared to 967 banks branches and 1,316 ATMs nationwide- this is according to the BoG 2015 Annual Report”, he noted.

Touching on the opportunities pertaining to the service, he said Government adoption of the mobile money is still in its early stage and there is a evidence that it can improve the government’s ability to monitor financial flows and reduce illicit activities.

Government using mobile money , for salary disbursements , could prove to be an enormous driver of the service throughout the economy on the whole.

He said in Ghana, Government’s payment of LEAP which is the Livelihood Empowerment Against Poverty , that provide stipends to the very poor in communities, is currently being enabled through mobile wallet.
This he said, has facilited the process and brought much convenience, safety and reliability to the entire process to the benefit of the consumer and the government.

Access and use of more value adding financial services such as savings , credit, and insurance could prove far more beneficial to deprived people. To develope these services , businesses , government, and other institutions must innovate actively to complement the ones deployed by mobile money operators.
According to him, Mobile Money systems can made available wherever there is wireless phone service, helping to overcome distances, as well as the lack of branch offices in rural areas. With the large number of agents , wide distribution and lower cost of service delivery.

According Mr. Asante, despite the successes and achievements chalked, there are numerous hurdles that are impending the growth of the service.

This he said, first observers of the service usually exercise some fear of possible loss of funds on their electronic wallets. He said, much investment has been made by the service providers to enhance security on the electronic wallet platforms to improve user confidence.
Adding that, Encryptions have been made to secure user details and transactions in addition to investments in risk monitoring instruments such as AML software.

He ha therefore commended, Bank of Ghana for coming out with new guidelines to empower non-basnking institutions like MTN to participate in the delivery of financial services to Ghanaians.
“The implementation of the new guidelines to regulate Mobile Financial Services (EMI Guidelines) is definitely a step in the right direction and we commend the central Bank for this giant step. This will boost the expansion of the industry and its impact on financial inclusion in Ghana.

By: Isaac Kofi Dzokpo/NewsGhana.com.gh

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