We want to build one-stop digital market place, says MTN

It is three years since MTN Mobile Money was separated from telecom services. How has it been so far?

We have seen exponential growth with active mobile money customers growing from 9.5m to 13.5m, mobile money merchants rising from 50,000 to 400,000, cumulative agents increasing to 230,000, and expanded our loan products, which has helped us to more than triple our disbursements from Shs400b in 2022 to Shs1.2 trillion.

How are you managing to achieve this growth amid tight competition?

We have a target to build the largest and most valuable Fintech platform in Uganda and Africa, in general. Therefore, we are leveraging partnerships to reach different segments of the population and building products and services that keep us relevant to customer needs. 

Government, and in particular Bank of Uganda, is pursuing a cashless economy. Do you have any role to play?

Yes of course. Historically, our services were limited to basic money transfer solutions. Today, we support digital economies and marketplaces. We are at the forefront of providing consumers and businesses with innovative digital financial services such as payments, e-commerce, lending, and remittance services. We leverage mobile technology to enable our customers to pay for goods and services and handle other financial needs.

Furthermore, we have empowered businesses to receive and make payments digitally and we remain committed to creating a marketplace that supports cashless and digital economies.

How is the progress of mobile financial services in Uganda?

It is a dynamic, vibrant and competitive space. To date, 42 payment service providers and payment system operators have been licensed by Bank of Uganda under the National Payment Systems Act 2020. The payments competition industry includes supervised financial institutions as well. All these have been innovating for the benefit of customers and businesses. 

Nevertheless, even with a positive competitive landscape, increased industry-wide collaboration on cybersecurity is essential to safeguard the integrity of the Fintech industry ecosystem.

How has the increased Fintech licensing impacted mobile money?

Beyond money transfers, it has opened-up digitisation of new ecosystems such as transport, agriculture, insurance and e-commerce. This has pushed us to enhance our offerings and improve customer experience.

It has also prompted us to invest in cutting-edge technology to provide secure, accessible, and efficient financial services. The growth of Fintechs has expanded the ecosystem, fostering partnerships and collaborations that enable interoperability and broaden service delivery.

However, it has also intensified competition, requiring us to differentiate through innovation, superior service quality, affordability, accessibility, and reliability.

What initiatives have you taken to ease and increase access to financial services?

We have recently partnered with commercial banks to deliver innovative solutions that provide flexible soft loans. These efforts are part of our broader strategy to drive financial inclusion and complement our existing offerings to increase loan uptakes and savings.

In addition, we have enhanced our offerings to Saccos by collaborating and providing liquidity support, both in cash and float, expanded our agent network to enhance service coverage, launched the MTN Mobile Money School fees campaign, and expanded our merchant network to facilitate digital payments for businesses across various sectors.

We have also partnered with banks to digitise the disbursement of Parish Development Model funds to the beneficiaries and clinic PESA to roll out a healthcare financing solution targeting uninsured individuals through digital mobile healthcare microloans, savings, payments, and value creation platform where members set aside dedicated funds to offset medical bills and purchase drugs.

I assume this journey has not been without challenges, any unique ones you would want to share?

There is still insufficient knowledge among Ugandans regarding the use of digital channels for payments and transactions. However, we continue to bridge the knowledge gap through various campaigns that educate customers on how to pay for goods and services using digital payment channels.

Additionally, despite efforts made to improve mobile penetration, the number of customers without mobile phones remains high, with a bigger disparity in smartphone penetration. This has impeded the uptake of financial and digital services for customers.

Fraud and social engineering continue to be a challenge, while the tax policy (0.5 percent cash withdrawal tax), makes services more expensive for customers who largely are at the bottom of the pyramid. However, we are committed to engaging with government to advocate for an optimised tax policy to further drive financial inclusion.

Are there collaborations you have undertaken to improve digital literacy?

Digital literacy and financial education are embedded in all our campaigns. We run the Beera Steady campaign to empower customers to identify fraud and be less susceptible to fraudsters. In addition, we set up Agent Quality Management through which a team is allocated to empower our agents to educate the customer on digital financial services

Dealing with money comes with its challenges, money laundering being key. How have you navigated this so far?

We have implemented an anti-money laundering programme that includes effective policies and procedures to guide on management of money laundering, 24/7 transaction monitoring, installed effective systems to support detection and prevention and implemented effective know-your-customer and customer due diligence processes.

We see emerging technologies, such 5G and AI. How is mobile money leveraging these to improve services and mitigate risks?

We have particularly leveraged the high 5G speeds to support enhanced capabilities for smartphone users using our App. We have also set up a robust and secure platform to mitigate and prevent fraud and cyber-attacks, which enhances end-user trust. Furthermore, we have leveraged artificial intelligence and machine learning for fraud detection and data-driven decisions.

What is your project on the mobile money market in the next three to five years?

I will particularly speak about MTN mobile money. Of course, our growth ambitions for the next three to five years centre on continuing to establish a robust Fintech platform ecosystem on which we shall drive the expansion of active customers, expand a network of agents and merchants, and further drive adoption of advanced services. 

Future focus

We shall continue to focus on enhancing our payments and lending prepositions for businesses and consumers to scale adoption, which will not only help us to increase our services preposition, but help us to grow our tax contribution from the Shs380b.

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