Mobile money is any payment transaction carried out using electronic means, it is also called mobile banking.
Recently, mobile money has brought in drastic economic changes in the economy of countries that embraced it. Kenya is an example of such.
Nigeria however, has been slow to adopt mobile money services as previously the Central Bank of Nigeria was reluctant to issue licenses to telecom companies to render mobile money services.
Nigeria has the largest economy in Africa according to GDP with a population of over 180 million people, yet close to 36.8% of this population don’t have bank accounts despite all efforts made by the traditional banks as of April 2020.
Talk more of now banks are no longer in the business of opening new branches, the left few years has seen a lot of banks close down already existing branches.
Overall, this is not good for the Nigerian economy. Mobile money will likely boost the economy as more people both in urban and rural settlements have mobile phones.
Since the inception of mobile phones in Nigeria, phones have increasingly made rapid growths and will continue to do so.
Harnessing this already existing platform to promote mobile money in Nigeria is one of the best options as these can further drive financial inclusion thereby reducing the level of poverty in the country.
There are models of mobile money services as approved by the Central Bank of Nigeria (CBN), two of these models include, the Bank-led model and the non-bank led model.
In the bank-led model, the bank delivers mobile money services either entirely on their own or in partnership with other banks.
Most banks now have to serve their customers through mobile money agents while in the non-bank led model, a corporate organization delivers these mobile money services but only if they are duly licensed by the CBN.
MTN, one of the telecom companies in Nigeria is an example of this model. MoMos Agent is their platform for carrying out mobile money services in Nigeria and other telecom companies are set to follow suit.
MTN’s MoMo Agent allows users to send and receive money to people without bank accounts and as well as pay bills. Point of Sales (POS) agents have also made mobile banking easier and commonly used in Nigeria.
Mobile money services were first launched in Nigeria in 2009, over the years various other mobile money service providers have emerged but yet Nigerians are to fully recognize and embrace the change.
Many Nigerians prefer to use cash in their transactions because the sellers want cash payments and these behaviors are not helping implement mobile money in Nigeria.
Even with the risk involved such as falling prey to theft or fire outbreak, most Nigerians still prefer cash.
In 2012, the Nigerian government introduced a cashless policy intending to reduce the movement of cash, creating an avenue for economic growth and also placing bans on the daily cash withdrawal an individual or organizations can make.
However, these policies did not produce the intended result, as individuals referred to the use of informal financial services.
Mobile money in Nigeria will do the country’s economy a whole lot of good, from the health aspects at least it will reduce germs from being transferred from cash notes.
Nigerian youths have embraced mobile money in Nigeria more than their predecessors. More licenses should therefore be issued so that organizations meeting the requirements can come into this mobile money market as this will greatly increase the rate at which the agents work effectively as when there is worthy competition, growth is inevitable.
About the Author
Chibuzor Elizabeth Chijioke a graduate of Abia State University is a Nigerian-based entrepreneur and content writer. She trained as a digital marketer at Innovation Growth Hub. She is committed to teaching people how to apply technology to better their lives and businesses. She spends her leisure reading sci-fi and fantasy novels.
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