Mowali Invents New Layer in African Fintech and Payment; MPESA Take Note

Mowali Invents New Layer in African Fintech and Payment; MPESA Take Note

Two of Africa’s largest mobile operators and mobile money providers, Orange Group and MTN Group, today announced a joint venture, Mowali (mobile wallet interoperability), to enable interoperable payments across the continent. Mowali makes it possible to send money between mobile money accounts issued by any mobile money provider, in real time and at low cost.

As banks debate the feasibility of open banking standard (pdf) across African economies, they may be late: your phone can do just that, becoming your bank account, and usable in the emerging new banking institutions of the 21st century. Mowali has fixed a huge market friction, bringing all the mobile networks together [you better get in] to engineer a new level of value in the payment sector in Africa. Yes, an operator agnostic mobile money service is here: MTN and Orange would party! The path to build a truly pan-African digital remittance/transfer financial product which is agnostic of location or currency in Africa is cleared.

Mowali will immediately benefit from the reach of MTN Mobile Money and Orange Money (OrangeMoney.orange.fr), bringing together over 100 million mobile money accounts and mobile money operations in 22 of sub-Saharan Africa’s 46 markets. Mowali is ready to enable interoperability between digital financial service providers beyond MTN and Orange operations and markets, to support the existing 338 million mobile money accounts in Africa.

Mowali is a digital payment infrastructure that connects financial service providers and customers in one inclusive network. It functions as an industry utility, open to any mobile money provider in Africa, including banks, money transfer operators and other financial service providers.

The objective of Mowali is to increase the usage of mobile money by consumers and merchants.  Mowali enables money to circulate freely between mobile money accounts from any operators in all countries. From the customer’s point of view, this means “I can pay or receive money anywhere from my mobile account regardless of my operator”. The system will unlock further innovation in the digital financial space within the continent. This is the greatest threat to MPESA in East Africa at least. They are building the new layer we need in Africa.

In this videocast, I discuss the need to build a truly pan-African digital remittance/transfer banking product which is agnostic of location or currency in Africa. None of the products we have today meets that standard. Largely, I envisage a situation where all you need to buy and sell across Africa is one bank account in just one African Union country. With that, you do not have to even think about the specific currency of that account as technology will seamlessly make it possible to access other African markets for payments, transfer etc. The banks or fintech companies must still comply with all regulations related to international transfers, forex etc. The only difference is that customers will not see them as they will be hidden with technology.

Stéphane Richard, Chairman & CEO of Orange:

“by providing full interoperability between platforms, Mowali will provide an important step forward that will allow mobile money to become a universal means of payment in Africa. Increasing financial inclusion through the use of digital technology is an essential element in furthering the economic development of Africa, particularly for more isolated communities. This solution embodies Orange’s ambition to be a leading player in the digital transformation of the continent. By joining forces with another of Africa’s market leaders, MTN, we aim to accelerate the pace of this transformation in a way that will change the lives of our customers by providing them with simpler, safer and more advantageous services. “

 

Rob Shuter, Group President and CEO of MTN.
“One of MTN’s goals is to accelerate the penetration of mobile financial service in Africa, Mowali is one such vehicle that will help us achieve that objective. Furthermore, co-operation and partnerships that help us accelerate the pace of development and overcome some of the scale, scope and complexity of challenges that society faces are key. This partnership with Orange is therefore an important step in helping us play a meaningful role in supporting the United Nations’ Sustainable Development Goals related to eliminating extreme poverty and enhancing socio-economic development in the markets we operate in and beyond. Thus giving our customers access to a bright, digital future.”

 

Mats Granryd, Director General, GSMA

The GSMA supports the Mowali initiative as interoperability at this scale is a key accelerator for both financial inclusion and Mobile Money usability across Africa.

“Today, there are over 690 million mobile money accounts around the world. Mobile money services have become an essential, life-changing tool across Africa, providing access to safe and secure financial services but also to energy, health, education and employment opportunities. The creation of Mowali will help to further transform mobile financial services throughout the African region. It demonstrates the mobile industry’s continued leadership and commitment to driving financial inclusion and economic empowerment through industry collaboration. The GSMA is proud to support its development,”

 

Kosta Peric, deputy director of Financial Services for the Poor, at the Bill & Melinda Gates Foundation
“Interoperability of digital payments has been the toughest hurdle for the financial services industry to overcome, in support of financial inclusion. With Mowali, Orange and MTN deliver a solution that will enable them, and other companies, to scale digital financial services across Africa, faster, to everyone—including the poor. This is a signal that a new wave of innovation, which can help alleviate poverty and drive economic opportunity, is coming. We’re pleased to see an implementation of Mojaloop [Mojaloop is open-source software for financial services companies, government regulators, and others taking on the challenges of interoperability and financial inclusion]—an open source payment platform available to operators across the sector—help achieve that.”

From Copyright-free press release from Orange

Share this post

Post Comment