Telecom firm to start cross-border mobile money services

A mobile money agent attends to customers in Kampala. Mobile Money services have become popular among Ugandans due to the high penetration levels of mobile phone services. FILE PHOTO

What you need to know:

Cross-border money mobile transfer presents telecoms an avenue to improve earnings.

Kigali- MTN Rwanda will next month integrate its mobile money system with that of MTN Uganda, allowing subscribers to send and receive money between the two countries.

Mr Norman Munyampundu, MTN Rwanda general manager, said the two sister telecoms would sign a partnership deal by the end of this month. This should be good news for traders, parents, students and travellers as it will ease money transfer between the two countries.

Mr Munyampundu is optimistic the service will reduce the cost of transactions and enhance cross-border trade between Rwanda and Uganda.

“After establishing our presence in Uganda, we shall rollout the interconnection platform across the East African Community bloc,” he noted.

The telecom is taking cue from Tigo which early this year started cross-border mobile money services with its sister company Tigo Tanzania. MTN pushed Rwf96.5 billion on its mobile money during the third quarter of the year, up from Rwf80 billion in the second quarter. This involved about 4.5 million subscribers compared to 3.5 million previously.

According to Mr Munyampundu, MTN Mobile Money penetration expanded by 81 per cent by end of September, contributing 44 per cent of the firm’s revenues.
Local telecoms have lately been seeking new avenues through which they can increase their earnings following a poor run over the past many months.

Mobile Money payments increased by 94 per cent, from Rwf134.1 million end of June last year to Rwf260.7 million this year. The number of transactions increased from over 21 million to over 43.5 million during the period, according to the central bank monetary policy and financial stability statement released in August.

Aline Ingabire, a city trader, said the development would ease her business transactions and help her save.

“I have been using informal money transfer agents at Nyabugogo to send money for some of the supplies I buy from Uganda, which is expensive and time-wasting.
“If MTN introduces a service to enable us send money at affordable charges, it will help me save,” she said.

Mobile Money in Uganda
Introduced in 2009 in Uganda, mobile money services have become so popular among Ugandans due to the high penetration rates of mobile phone services.
The volume of money transacted in Uganda through mobile money has also grown substantially over the years, hitting Shs11.7 trillion last year, up from Shs3.75 trillion in 2011 while subscriber numbers have grown to 8.9 million users.