Giant Telecommunications company MTN Nigeria, has reportedly recovered N12.5 billion lost due to a glitch in its mobile money system, as the company’s monthly active users continue to grow.
Recall that in 2022, MTN mobile money (MoMo) experienced a system glitch that cost the company over N10 billion in loss.
In a suit dated May 30, 2022, MoMo alleged that ?22.3 billion was transferred in error to 8,000 accounts maintained by the 18 banks’ customers using MoMo. The company referred to the loss as “customer-initiated transfers” and assured its customers that their funds were not lost and all their data was still secure.
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Anthony Usoro Usoro, the CEO of MoMo, asserted in the lawsuit that the fraud spanned 700,000 transactions in the space of one month. To avoid further liabilities, MoMo shut down its service on May 25 after becoming aware of the fraud on May 24. The following day, service was quickly resumed.
In its latest 2023 financial report, MTN disclosed that while N12.5 Billion has been recovered to date, the balance of N9.5 billion will be absorbed by the company due to a shared services cost agreement between the telco and MoMo service.
MTN’s Fintech revenue increased by 2.4%, led by Xtratime (MTN airtime lending product), which rose by 2%. However, despite the challenges from the NIN requirement for KYC introduced in Q4 by the CBN, the company added 3.3 million active wallets in the year to 5.3 million. This helped to drive MoMo PSB revenue, which rose by 8.1%.
Commenting on the 2023 full year report, MTN Nigeria CEO Karl Toriola expressed satisfaction with the progress in building the MoMo PSB wallet base, noting that monthly active users have increased from 3.3 million in the year to 5.3 million.
Part of his statement reads,
“The growing adoption and increased activity within our Fintech ecosystem spurred transaction volume growth of 49.2% YoY. We also now have over 326k MoMo agents, up 46.0% YoY, and over 324k merchants since we started to build out our merchant ecosystem in March 2023.
“While the overall development of fintech has been slower than anticipated, these milestones mark solid and important progress in scaling our business, particularly the advanced services within our MoMo ecosystem”.
Toriola further disclosed that the company expect 2024 to be a challenging year due to the rising inflation and devaluation of the nairo
In January 2024, the inflation rate reached 29.9%, while the exchange rate has Further, devalued to N1582/$ as at 26 February 2024. This is anticipated to put additional pressure on consumers, the cost of doing business and Further potential Forex losses.