Ghana Association of Mobile Money & Bank Agents

Ghana Association of Mobile Money & Bank Agents

We are seeking for united front by creating a voice in the face of regulation, supervision and income tax obligations. An umbrella body like GHAMMBA helps.

20/11/2017

Ghana Association of Mobile Money & Bank Agents

Mobile money fraud has in recent times heightened with unsuspecting individuals been swindled by fraudsters.

Statistics show that at least 50 percent of Mobile Money subscribers have either experienced one form of fraud or have been a target from Mobile Money fraudsters. Here are some few tips to help avert Mobile Money fraud.

.Never disclose your secret pin to anybody, including vendors.
.Change your pin periodically to avoid being hacked.
.Keep your Mobile Money account secret.
.Transfer money into your wallet before sending to a third party.
.Call to verify if money have been received when using the services of vendors in town.
.Don’t download suspicious apps.
.Double check to confirm if indeed money has been mistakenly sent into your wallet before you resend.
.Be vigilante when making a mobile money transaction.
.Avoid mentioning out loud your contact when at the vendor, instead write it on a piece of paper and hand it over directly to the vendor.
.Do not open a Facebook account with your mobile money number; it can easily be profiled by fraudsters.
.Ignore suspicious text messages asking for money to release a package or prize especially if you have not been engaged in any draw or raffle.
.Conduct checks on people you employ to operate Mobile Money Service.
.Know Your Mobile Money Agent – Be wary of where you visit to conduct Mobile Money transactions.

[10/08/17]   Mobile money fraud has in recent times heightened with unsuspecting individuals been swindled by fraudsters.

Statistics show that at least 50 percent of Mobile Money subscribers have either experienced one form of fraud or have been a target from Mobile Money fraudsters. Here are some few tips to help avert Mobile Money fraud.

.Never disclose your secret pin to anybody, including vendors.
.Change your pin periodically to avoid being hacked.
.Keep your Mobile Money account secret.
.Transfer money into your wallet before sending to a third party.
.Call to verify if money have been received when using the services of vendors in town.
.Don’t download suspicious apps.
.Double check to confirm if indeed money has been mistakenly sent into your wallet before you resend.
.Be vigilante when making a mobile money transaction.
.Avoid mentioning out loud your contact when at the vendor, instead write it on a piece of paper and hand it over directly to the vendor.
.Do not open a Facebook account with your mobile money number; it can easily be profiled by fraudsters.
.Ignore suspicious text messages asking for money to release a package or prize especially if you have not been engaged in any draw or raffle.
.Conduct checks on people you employ to operate Mobile Money Service.
.Know Your Mobile Money Agent – Be wary of where you visit to conduct Mobile Money transactions.

[05/16/17]   0
Vice President, Dr. Mahamudu Bawumia has disclosed that government is working to meet its November 2017 timeline for the implementation of mobile money interoperability.
The system when rolled out will allow consumers transfer money across the various networks in the country.
The Ghana Interbank Payment and Settlement Systems (GhIPSS) has since been tasked to provide the platform for the mobile operators.
It followed a botched agreement with Sibton Switch systems which had quoted 4.6 billion cedis as the cost for carrying out the mandate.
Dr. Bawumia made the disclosure when he addressed the first day of the National Policy Summit on Monday.
“The President asked me to challenge the industry to make sure that this year, interoperability is achieved. We have challenged them and they have responded very well. In the last meeting we had with them, they showed us a road map and by the grace of God by November this year we will achieve interoperability of the financial sector in this country,” he asserted.
Mobile money interoperability forms part of efforts to drive the government’s financial inclusion agenda.
This is also the third of three pillars that the Vice President believes will drive the NPP’s economic growth agenda.
The two include a robust national database with an effective identification system as well as a national digital address system.
Dr. Bawumia who also heads the government’s economic management team is confident the financial inclusion drive should be achieved with an effective interoperability in the financial space.
“The third element is in the financial sector the payment system and we want to make sure that there is financial inclusion in this country but the key to that particular but a key to that particular area is to make sure that there is interoperability amongst the systems.”
GhIPSS to provide interoperable plaform
The CEO of the Ghana Interbank Payment and Settlement Systems (GhIPSS), Archie Hesse earlier confirmed the contract by government to develop an interoperable platform for telecom operators, to Citi Business News.
This is however subject to the efficacy of GhIPSS’s options to government in operating an interoperable platform for the Mobile Network Operators (MNOs).
“Currently if you are on MTN mobile money, you can work within the MTN sphere. The role of GhIPSS is to ensure that we have interoperability; so you could have MTN and be able to pay someone on Tigo cash so interconnecting all the platforms and making them platform neutral,” CEO of GhIPSS, Archie Hesse told Citi Business News.
“We were given six months so we intend to achieve that target,” he added.

3news.com 11/05/2017

Fraud alert! MMM Ghana operating ‘Ponzi scheme’ – BoG warns

MMM Ghana claims to give its participants 30 per cent interest on deposits monthly The Bank of Ghana has warned the public against the activities of a company it says has been taking cash deposits from people without the proper licencing. According to the Bank, the operations of the company, MMM Ghana, constitute that of a ponzi scheme through a virtual office “hence anyone who does business with MMM Ghana does so at his or her own risk”. MMM Ghana claims to be in 118 countries across the globe and with over 226 million participants. It pride itself of giving participants a 30 per cent monthly interest on their deposits and states that it does not operate an investment scheme but rather a “social financial network” . “Yes, it is possible to get 30% per month here, but this is not an investment program! This is a community of ordinary people, selflessly helping each,” it states on its website The Company is said to have over 10,000 clients in Ghana and moves from place to place mobilising cash deposits from the unsuspecting general public. “The institution’s operations are contrary to section 6(1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930) and also threatens the safety and soundness of the financial system,” BoG said in a statement Wednesday. BoG says MMM Ghana is not licenced to engage in any form of deposit-taking activity.

Source: http://3news.com/fraud-alert-mmm-ghana-operating-ponzi-scheme-bog-warns/

3news.com The Bank of Ghana has warned the public against the activities of a company it says has been operating taking cash deposits from people without the proper licencing. According to…

[09/01/16]   Banks that are still not in partnership with the telecom companies involved in the business of mobile money risk losing out on opportunities to expand and attract new customers, Eli Hini, General Manager, Mobile Money at MTN Ghana has said.

“If you are still a bank that is not willing to join in this new innovation then you are going to be left behind,” Mr. Hini said in an interview with the B&FT, after one of the focus discussions at the Ghana Economic Forum.

“This is an innovation that is sweeping the financial space and it is here with us and so the partnership with the banks is important and will help facilitate financial transactions and at the end of the day, the banks themselves will benefit from the platform and the technology it offers,” he added.

Mobile money services commenced less than a decade ago with only one operator but the exponential growth has now seenfour mobile network operators offer the service to 5.3million mobile money customers in the country of almost 27million.

According to the Bank of Ghana, the value of mobile money transactions reached GH¢35.4billion at the end of last year, an increment of more than 216percent over the previous year.

At the end of the first quarter of this year, the value of transaction hit GH¢13.76 billion, more than twice the GH¢5.94 billion recorded for a similar period last year.

With the presence of more than 30 banks, more than 20 savings and loans and over 500 microfinance companies in the country, the banked population of Ghana still stands at about 34percent with 952 bank branches and less than 1,500 ATMs spread across the country.

Meanwhile, according to the Bank of Ghana, the number of registered mobile money agents has now hit 93,376 as of the end of the first three months of this year, which is a 200 percent increase in the number of registered agents in just a year.

The surge in mobile money usage shows the vital role telecom companies are playing to advance the central bank’s cashlite economy agenda, and also ensure that the push for more financial inclusion is brought into the hands of millions of Ghanaians.

Industry watchers say the growth of mobile money will allow millions of people who are otherwise excluded from the formal financial system to perform financial transactions relatively cheaply, securely, and reliably.

With MTN being the biggest player, accounting for about 85percent of the mobile money market, working in partnership with 16 banks, Mr. Hini noted that it is in the interest of the banking sector that more banks join.

“Where we want to go is to have all banks participate because we believe the mobile money platform offers a lot of opportunities to banks and other financial institutions to be able to provide access to as many customers as they can in a much more efficient and cost effective way,” he said.

Mr. Hini wants the conversation to move away from banks competing with telcos to banks partnering with telcos to offer financial services.

“The whole idea is to achieve scale and ensure that we leverage on the accessibility and efficiency this platforms provide. We are in a dispensation where a lot of payments are going digital and these platforms facilitate transactions and so today most banks have come to the realisation,” he added.

Mr. Hini added that the very innovative banks are developing their savings products and will be using the mobile money platform to distribute them.

“So we have come a long way: if there is any bank today that has still not identified this opportunity, then that bank needs to sit up.The opportunities have been identified and banks are taking advantage. This message is to those who are not in because we believe those who are in have seen the positives and are taking advantage.”

- See more at: http://thebftonline.com/business/ict/20606/telcos-invite-more-banks-aboard-mobile-money-train-.html#sthash.jGWtRhRl.dpuf

[08/26/16]   The story goes that the banks showed little interest some years back when the whole mobile money idea was bounced off them, but a new survey by PricewaterhouseCoopers (PwC) indicates that the phenomenon has sent banks into a cold sweat, and they are beginning to adopt an ‘if you can’t beat them, join them,’ approach.

The PwC 2016 Banking Survey on the theme: “How to win in an era of mobile money,” released on Thursday, said much as banks consider the Mobile Network Operators (MNOs) as partners due to their ease of deposit mobilisation through use of technology, banks are increasingly worried the mobile money operators will metamorphose into banks.

The concerns come at a time funds deposited with the banks by mobile money operators, which is referred to as the balance on the float, has increased from GH¢19.6 million in 2012 to GH¢581.3 million in the first quarter of this year.

According to respondents of the survey, which included CEOs, Chief Financial Officers and Heads of E-banking of commercial banks, mobile money is evolving into “banking on your phone,” which provides customers with alternatives to traditional banking.

The bank executives feared that the E-Money Issuer (EMI) Guidelines -- issued by the Bank of Ghana last year to regulate the mobile money service -- have set the stage for a possible entry into the banking arena by telecom companies.

Judging by the framework for mobile money operations as established by the central bank, respondents said it is possible for telecom companies to develop to the point where they can operate mobile money services independently of banks.

“Telcos will at that point become direct competitors to banks instead of partners and service providers to the industry. To curtail this threat, most banks are quickly building the relevant infrastructure that allows them to partner with telcos to jointly deliver mobile money services. Respondents believe there is enough opportunity in mobile money for both banks and telcos,” the PwC survey said.

In an interview with the B&FT, Vish Ashiagbor, Country Senior Partner at PwC said, “with mobile money making such drastic inroads into the banking space, we set out to understand what bank executives are making of the development and how they are planning to win in this era.

For us, winning in this era does not mean eliminating mobile money but rather being competitive both in spite of any threats, and due to any opportunities, that mobile money presents,” he said.

Last year, mobile money operators recorded a value of transaction of about GH¢35.4billion, an increase of more than 216 percent over the 2014 data.

Last year’s transactional value was recorded on the back of more than 260 million transactions in a market that has since seen a new entrant in the form of Vodafone Cash, powered by the namesake mobile operator.

The value of mobile money transactions when put into perspective is just GH¢5.85billion shy of the total deposit liabilities of the 29 banks as at the end of last year, a figure that is likely to be surpassed by the mobile operators this year.

Since the introduction of mobile money to the Ghanaian market in 2009, it has played a key role in the push for financial inclusion. According to data from the World Bank, in 2010 a relatively large segment of the Ghanaian population – 44 percent, was excluded from the financial services sector altogether.

During this period, access to formal banking services hovered around 34 percent, with banks creating innovative channels to pe*****te the market further. By 2015 however, the segment of the population excluded from the financial services system had dropped to 25 percent, according to the World Bank.

The drop in the population excluded from financial services was driven primarily by the widespread adoption of mobile money for financial services activities.

According to the latest Bank of Ghana report on the mobile money sector, between 2012 and first quarter 2016, registered mobile money subscribers increased from 3.8 million to 14.6 million, while active subscribers shot up from 345,434 to 5.3 million within the period.

- See more at: http://thebftonline.com/business/banking-finance/20674/mobile-money-unnerves-banks-pwc-survey-indicates-.html#sthash.H6ceZLw4.bDl0rI5J.dpuf

[08/22/16]   

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Friday, 19 August 2016 11:11

AFRICA'S MICROFINANCE REVOLUTION

Written by Ghana talks Business

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The business of microfinance is an expensive one. Providing small loans to the poor is a labour-intensive process that is fraught with credit risk. Micro financial institutions (MFIs) working in emerging markets have to deploy loan officers in large numbers to work with remote populations, often scattered across challenging physical geographies. And they have to do this using limited customer data.

In these conditions, generating business, scoring potential clients and processing loans and payments requires that loan officers work with relatively small customer pools, which increases operational costs. Overcoming this challenge has meant that MFIs have traditionally looked for ways to optimise their productivity by grouping their customers or by bundling certain services. It has also meant that interest rates for clients have been high.

Tech transformation

But technological innovation is changing the way MFIs are doing business. Markets in Africa are leading this shift thanks to the continent’s experience of mobile money, as well as its culture of innovation. In Kenya and Tanzania, where financial technology (fintech) developments have gone hand in hand with progressive regulation, the results are pushing down operating costs, lowering customers’ repayment rates and contributing to accelerated financial inclusion.

Developments in mobile technology have played an important role. As is the case with its conventional counterpart, microfinance is increasingly turning to mobile solutions to generate additional growth. This has affected the way in which MFIs gather, transmit and analyse data. By creating more efficient scoring mechanisms, through the use of larger data sets, MFIs are swiftly becoming more productive, and in doing so are scaling up their operations.

“Providing microfinance offerings to rural and remote communities generally leads to higher operating costs. But the effective use of technology, across the whole microfinance operating chain allows MFIs to extend their reach and serve smaller clients at a lower cost,” says Scott Brown, chief executive of VisionFund, the microfinance arm of development organisation World Vision.

Though industry veterans are optimistic about the future, most are keeping a grounded perspective on these developments. For one, mobile- and data-based innovations present their own set of operational challenges. Teething problems are also expected as these new systems are deployed in the field. Moreover, most MFIs recognise that a reliance on technology must not undermine all-important personal relationships between the customer and the organisation, a bond which forms the bedrock of the industry.

“Despite these technology advancements, we must not lose the client touch. Once you lose the client touch and you’re just taking information in and putting it through a scorecard then you lose the ability to understand that client,” says Mr Brown.

Pace of innovation

For now, however, innovation is occurring at a blistering pace. For its part, VisionFund is pushing hard to lower its operating costs by improving the way it aggregates and uses customer data. According to Mr Brown, VisionFund aims to allocate about 500 customers per loan officer, though in markets with more dispersed populations this number can go down to between 200 and 300. Yet, the hope is that through technology investments the productivity of individual loan officers will increase, a trend that will help VisionFund to expand its presence in the most remote corners of the markets in which it operates.

“We have invested in tablet technology to increase the productivity of our loan officers. Using tablets, our staff can input information relating to a client's financial and personal data and send this through to our mainframe where the information can be scored and a loan approved. It’s high speed and low cost,” says Mr Brown.

“We have a premise that our costs should go down in our branches by 30% to 50% because our productivity is going up. If this proves to be accurate, we can move a lot faster into rural areas because our costs have dropped.”

This virtuous cycle of cost reduction and market pe*******on, especially in remote and underserved areas, is leading to greater financial inclusion. It is also formalising much of the grey economy in markets where the government is in need of an expanded tax base, and where underserved sectors such as agriculture have much to contribute to economic growth. Beyond the benefits linked to financial inclusion and economic development, these trends also present a compelling business opportunity.

Fintech frontiers

With growing frequency, fintech firms are now gaining a foothold in Africa’s microfinance sphere. The application of advanced technology to the microfinance operating chain is not only proving commercially lucrative but is having profound implications for the way that these MFIs do business. In November 2015, MyBucks, a Luxembourg-based fintech firm, acquired six banks from Opportunity International, a global MFI, across sub-Saharan Africa.

The deal was unique in that it represented the first time a fintech firm had acquired the operations of a microfinance operator. In doing so, the two organisations are hoping that combining knowledge of mobile and digital banking of MyBucks on the one hand, with the client base and network of an established microfinance player such as Opportunity International on the other, will augment financial inclusion and yield improved operating results.

In a similar vein, Finca, one of the world’s leading microfinance institutions, signed a partnership agreement with New York-based fintech group First Access in May 2016, to establish the largest alternative microfinance credit scoring system in the world. First Access will assess Finca’s existing client information, as well as data sourced from local mobile network operators (MNOs), to provide enhanced client credit scores.

“The microfinance industry developed before any consumer data was available in emerging markets. To get around this, MFIs used joint liability in local communities to ensure that loans were repaid rather than lending on an individual basis,” says Nicole Van Der Tuin, chief executive of First Access.

Driven by data

But with an increasing trend towards lending to individuals, MFIs have had to adapt the way in which they do business. In the past, most MFIs did not offer risk-based pricing and instead provided a flat interest rate to their clients. Not only was this expensive for those taking out micro loans, but it also failed to encourage the kind of financial inclusion that MFIs set out to achieve. Today, improved data sourcing and analysis is offering a remedy to this situation.

“What we have learned is that the source of the data doesn’t tend to matter. First Access started out using mobile phone data but we realised that MFIs can make use of their existing, archived data in new ways. What’s more important is the quantity and quality of the data and the way in which it is analysed and scored,” says Ms Van Der Tuin.

First Access therefore works with existing lenders with extensive historical data. The company then combines this information with new sources, including a customer’s mobile phone data provided by local mobile operators, and creates an algorithm tailored to the market in which it is operating. By adopting this approach, Ms Van Der Tuin says that the company looks at a specific institution’s historical data and uncovers inefficiencies while improving the long-term performance of an MFI’s lending activities.

“In countries such as Nigeria and Kenya, there are growing numbers of digital lenders. You are starting to see a lot more digital activity and the adoption of new technology that is bringing down the costs of doing business,” says Ms Van Der Tuin.

Too big a risk?

Nevertheless, this technology boom has not been without its casualties. Given the low barriers to market entry for most tech firms, the learning curve can be steep. For a digital platform that is also in the business of lending, this means starting out from scratch with fresh data sets and the need to develop a workable metric to measure non-performing loans can be challenging.

“It’s easy to reach someone and give them a loan but figuring out how to make that process sustainable and to make it work over the long term, that’s the hard part,” says Ms Van Der Tuin.

Indeed, while technology is opening up new opportunities for growth for the microfinance industry as a whole, it is also presenting new challenges. Given that some MFIs are looking to automate the credit scoring processes of customer pools or segments deemed to be low risk, an approach that drastically reduces overall costs, it does raise questions about an institution’s willingness to lend to a customer with which it has a limited personal relationship as well as the size of the potential loan.

“Risk management in microfinance is difficult. How reliant can a microfinance organisation be on data-driven scoring cards? How much can they be prepared to lend to a client they haven’t met?" says Chris Low, managing director of Letshego, a microfinance provider with a presence across sub-Saharan Africa.

For its part, Letshego has not only outsourced the scoring process, but with it the initial lending activity for new clients. “Letshego intends to outsource the credit scoring of new clients, which includes their early borrowing cycles, to an external partner. After this time, we believe that it will be possible to predict with about 95% accuracy the client’s repayment behaviour,” says Mr Low.

Mobile moves

Beyond the use of data, MFIs are increasingly making use of mobile microfinance products and services by building on the success of mobile banking. In Kenya, a partnership between the Commercial Bank of Africa (CBA) and mobile network operator Safaricom has produced a market-beating mobile microfinance offer known as M-Shwari. Leveraging the success of M-Pesa, the mobile money product, M-Shwari operates as a unit of M-Pesa in which customers are offered combined savings and loan product at the micro level.

Customers open a bank account with the CBA through M-Shwari that is subject to standard regulatory norms. Once opened, they are then able to apply for micro loans through their mobiles. The minimum size of a deposit is Ks1, while the minimum loan size is Ks100. Loan applications are based on existing customer data, held by both the CBA and Safaricom. If insufficient data is in place, customers must wait up to a few months and exhibit creditworthiness through positive deposit behaviour. They are then scored based on M-Shwari’s unique algorithm.

Though M-Shwari is an example of a microfinance system being offered through a conventional mobile money, elsewhere MFIs are developing their own mobile microfinance offerings. Kenya’s Equity Bank has established its own mobile virtual network operator in order to launch Equitel, its mobile banking platform, by leasing a local MNOs excess spectrum capacity. Through its Equitel offering, Equity Bank is providing small and micro loans to its customers.

“Mobile microfinance has many advantages. When you look at mobile pe*******on in Kenya, it is very high. And it also helps to keep costs down,” says Paul Githinji, manager, head office operations, at Equity Bank.

Listening to the customer

But mobile microfinance offerings are only as good as the market in which they are provided. In Kenya and Tanzania, rolling out these products and services is made easier thanks to the history of mobile money in both jurisdictions. This means that regulators, as well as consumers, are up to speed in terms of engaging with new offerings. It also means that financial institutions and mobile network operators have more mature and co-operative relationships relative to other markets on the continent.

Above all, the success of mobile microfinance offerings comes down to the financial literacy of the end consumer. “There are a number of challenges linked to the rollout of mobile microfinance offerings. The first is financial literacy. It is important to ensure that new clients have basic financial planning skills and many microfinance providers, including Letshego, have mechanisms in place to support financial education,” says Mr Low.

In the end, these innovations, and others, can only help to spur the growth of the microfinance industry across Africa. By lowering costs and promoting financial inclusion, the real winners in this picture are the 2.5 billion unbanked adults living across the continent, as well as in Latin America, Asia and the Middle East. But as this revolution unfolds, microfinance operators must not lose the human relationships that have been the source of their strength and success to date.

“You can’t just make it all about technology,” says Mr Brown

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