With a banking population of not more than 21 percent in Rwanda, MTN Rwanda will be the pioneer of the a mobile technology that enables one to make a financial transactions using a mobile phone or any mobile device with SIM card technology. The technology will bring services to as close as your mobile phone. Kezio-Musoke David talked to MTN’s Albert Kinuma the Head of ‘Mobile Money’ on how the project will work.

What is MTN Mobile Money?

This is a new service that MTN is bringing to the public. It enables clients to send and receive money across the mobile territory and beyond using their phones. They will be able to buy utilities like electricity, pay salaries and many more other applications that are slated for this platform. We are launching the service on Wednesday.

How does it work?

The banking penetration is still very low and the mobile services have wider penetration levels. This is an opportunity for MTN to offer this service to the un-banked population. Someone in Rwanda who wants to send money to a relative would go to one of our 120 agents. ‘MTN Mobile Money’ agents are already across the territory.

One needs to be connected to the ‘MTN Mobile’ network. If the person has the interest the agent will do a SIM-swap because the service is SIM based. The client will have the standard calling account and the ‘Mobile Money’ account.

Initially the account will be at zero once connected. Once the person has loaded money on the phone the person can start transactions or purchases as required. Connection to the service is free.

What are the human benefits?

The major benefits include speed and security. Today if you send money to someone the process you have to go through requires one to go to the car move around and go to some place pick the money and then go to a transaction place. What we are offering is the ability to do it instantly. Once you have money on your ‘Mobile Money’ you can send it from the comfort of your house.

The amount of time being saved can be used for something else. It is safe you are carrying money which cant get lost. With ‘Mobile Mobile’ you have a code that enables you to make a transaction anywhere. So even if you misplace your phone, and another person takes it, it will not be possible for your account to be used.

Are there any regulations? For example what is the minimum that I can send?

Of course we have some regulations. We also follow the electronics payments law from central bank which guide on the maximum of daily transactions.

According to the law the maximum is Rwf 500,000 and that for monthly transactions is Rwf3 million. For ‘MTN Mobile’ service, the minimum transaction is Rwf1,000 and the maximum daily transaction is Rwf300,000.

Rwanda banking population is at 21 percent and yet your mobile subscriber base is at 1.8 million. The ratio of your subscribers to Rwanda’s population still doesn’t add up.
If we look at absolute numbers in that sense we can say that is low indeed. But remember anyone who is on ‘MTN Mobile Money’ can send money to any one else. Only the originating person who has to be MTN. However the receiving party doesn’t have to be an MTN subscriber, it is anyone. So it is 1.8 million to anyone in Rwanda.

What kind of consumer are you targeting?

We are targeting the general population of Rwanda. This is a mass market product. Every one uses money, every one has a relative who needs money. Everyone needs to buy consumables.

There is a consuming class which will still utilise Western Union and MoneyGram!

Of course the benefit of such a service has a wider impact in the rural areas because the entire country doesn’t have access to financial services. So indeed one of the main purpose of this service is to enable that part of the population. We are targeting them specifically to ensure they benefit from the financial services.

But beyond that I cant say we are target only that segment of the population we are also targeting some people who earn more money and live in the cities because people who live in the cities also have relatives in the rural areas so will be the ones sending money to the rural areas.

‘Mobile Money’ will be utilised in many other ways once we bring corporate services on board. We will also be targeting the higher end market as well.

Diaspora remittances went high in 2009 and they envisaged increase by over 10 percent in 2010. Don’t you have the Diaspora community in mind?

When we look at this product we have to first start with a service which works well in Rwanda. But of course as we look at the development of the service and we are looking having a  regional transaction across East Africa and beyond.

You must have already tested the product, are you happy with the results?

For us to launch the service we have to test it thoroughly and ensure it has highest level of quality. The project started in March 2009. last year we started with the project implementation throughout the course of the year. We started the tests in November.

We have been having some pilot customers come on board and we have made tests to make sure that it can sustain a high level of transactions so indeed we have done the testing before launching it to public.

Of course the test we have done have allowed us to fix most of problems that we would have been suspicious of. Like any system I wouldn’t say that it is 100 percent shock proof but it is as close as it can be.

It will have the highest standard that people can expect from MTN in terms of service availability, security and so forth.

Is this an entirely MTN initiative?

MTN didn’t develop the software, we had a partner supplier called FUNDAMO the company which provided us with the solution and they are actually the leading providers of this kind of software. It is the same company which has already worked with MTN in Uganda.

MTN Uganda partners with Stanbic Bank. Where is your ‘Mobile Money’ account?

Our partnering bank here in Rwanda is Commercial Bank of Rwanda (BCR). It is the company with which we started this partnership. Our agents will be depositing money there. But as we go forward we are going to partner with other banks who are interested.

Who is regulating this project? Is it RURA or central bank?
The service itself which is based on electronic payments is regulated by the central bank. The central bank after acquiring the licence has given us the go ahead to start the service.

What was the initial capital investment of this project?

It was a substantial amount of money. That is what we need to understand right now. We still need to invest in it and the investment is a continuing process. This is a business which will make a difference for the people and MTN as well.

Benefits of Mobile Money

• Fully compliant with all banking    regulations
• Send money from anywhere in the    country from the convenience of    your mobile phone
• The recipient does not need to be an   MTN customer, or have a mobile    phone.

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