By Michael Pasternak, Head of Sales, FTS
March 29, 2016
Sub-Saharan Africa leads the rest of the world when it comes to mobile money and the adoption of financial services on mobile, thanks to the combination of an unbanked population with advanced mobile penetration. Yet challenges still remain: education and adoption vary widely from one country to another, although the playing field is, very gradually, starting to level.
Mobile money services have begun to evolve beyond the person-to-person transaction to a more commercial environment, with banks introducing virtual accounts that combine mobile money accounts with banking services. The success of these innovations suggests that mobile money payments have the potential to be offered by many more industries.
Within the region, telecom operators are working hard to move mobile money technology beyond the provision of simple services such as the sending and receiving of funds towards merchant services. For these operators, effective operations in Africa require greater flexibility than anywhere else in the world but there has never been a better time for new players to enter the solution space, with cellular technology leading the way.
As mobile money solutions for traders and merchants converting to a cashless future emerge, there is a requirement to support the complex revenue sharing and commissioning business models that will encourage the growth and adoption of mobile money.
Transactions such as local money transfer, international remittance, bill payments, salary transfers, mobile banking, micro loans, mobile payments and many more involve a considerable number of partners in complex ecosystems. Operators need a flexible and agile payments solution that can support, change and personalize existing partners’ contracts and onboard new partners easily, whilst also supporting revenue sharing amongst multiple partners across the entire value chain.
Payment processing and commissioning are tricky and often sensitive procedures. With a flexible and scalable payments software solution in place, operators can not only ensure that payment processing can be scaled as a company’s business processes and complexity grow, but that intricate upgrades and expansions can be implemented to deal with rapid growth. Such a solution automates the billing and settlement functionality of commissioning and payment systems and provides operators and payment service providers with the tools to focus on the m-commerce arena too.
A mobile money solution should provide a comprehensive set of tools that can support any payment or banking process over the mobile network in real time, at any time. It should be able to support a broad range of different business models and settlements, such as that between the mobile money provider and utilities companies, for paying bills for example. But it should also be agile enough to support a whole range of completely different business models, pricing plans and settlements, such as those between the mobile money provider and its micro payments partners, which might provide applications and services such as vending machine sales, online content or parking fees. As for the end customer, mobile money should always provide a simple and effective user experience in which they are able to conclude a purchase, make payments, or transfer funds through their mobile device with a few simple steps.
With a smart revenue sharing solution in place, service providers will have full support for the complex revenue sharing schemes that mobile money requires. More complex value chains are also supported. A key feature for a mobile money software solution is to enable the rapid creation of new or modification of existing contracts easily and independently.
With a smart revenue sharing solution at their disposal, service providers in sub-Saharan Africa have the means to implement personalized contracts and relationships with every partner in their ecosystem, resulting in increased attractiveness and improved business relationships; reduced total cost of ownership; a remarkably fast time-to-market and ultimately, increased revenues.
For the mobile money industry in the region, this will bring greater innovation and improved adoption of financial services on mobile platforms. And for the sub-Saharan African un-banked population, this means financial flexibility and a greater range of services: a means to manage their money in the present and plan for the future, and a better chance to find financial stability at their fingertips.