An unprecedented solution supposed to revolutionize financial inclusion in Africa, the Mowali project has still not really achieved its objectives. It must be said that since its establishment, it has encountered several obstacles, in particular regional regulations on financial transactions. Although things seem to be off to a bad start, Orange continues to believe in it.
On November 22, 2018, the telecoms groups MTN and Orange unveiled their ambition to make their Mobile Money service interoperable in Africa. They had created a joint venture called Mowali for this purpose.
The platform was to initially bring together more than 100 million subscribers from the two telecom companies in 22 of the 46 markets of sub-Saharan Africa, with the ambition to interconnect in the long term the 153 Mobile Money services deployed at the time on the continent. . That is 338 million subscribers.
But three years later, the project is stalling. In West Africa, which was to be its land of experimentation, it came up against the ambition of the Central Bank of West African States (BCEAO) to launch its own interconnection hub for intra-UEMOA financial transactions, in gestation since 2017. Finally set up in 2020, this payment infrastructure allowing account-to-account exchanges, whatever the type of account (bank, non-bank), was entrusted to the Groupement UEMOA interbank electronic banking system (GIM-UEMOA) by the BCEAO.
Mowali had responded to the call for tenders launched by the Bank to select the manager of its interoperability platform but had not been preselected.
Despite the failure of the Mowali project in its original design, Orange and MTN have not given up on their ideal of mobile payments between different telecom operators present in Africa. The two telecom companies have thus reoriented their vision and invested in the segment of international transfers between different currency areas.
Initially, this reorientation did not receive a favorable assessment from the BCEAO. It had also seized Orange to inform him of the illegal nature of its services for receiving funds from France on electronic money accounts. Orange then undertook to comply with the requirement that the services be performed by an approved intermediary, in application of the provisions of Articles 2 and 15 of Regulation No. 09 relating to the external financial relations of WAEMU member states in order to continue to operate according to this formula. ” Orange Money to begin with has opened in four countries, Mali, Ivory Coast, Guinea and Madagascar. The money sent is immediately available in Africa. The service was very well received by the diasporas in France. In 2020, Orange Money multiplied the number of transfers by four. Over the past 12 months, we have opened 8 new money transfer destinations from France to Burkina Faso, Senegal, Morocco, India, Vietnam, Ghana, Congo and most recently the Democratic Republic of Congo », Explained Orange.
Beyond Mowali’s difficulty in making payment services interoperable between different telecom operators in Africa, the joint venture also encountered regulatory requirements relating to the sending and receiving of money between subsidiaries of the same company. “ The implementation of real interoperability even between our subsidiaries is subject to the approval of the regulators, ” said Orange. Approvals that are slow to come.
“ The implementation of real interoperability, even between our subsidiaries, is subject to the approval of the regulators, ” said Orange. Approvals that are slow to come.
But although everything seems to thwart the realization of the Mowali project in its initial design, the Orange group says it is determined to continue its efforts to make the interoperability of Mobile Money services a reality.
It is not excluded that things will end up moving over time, in the direction desired by the telecoms company and its partner MTN in view of the value gained by Mobile Money since 2018 and its importance in financial inclusion. on the continent, demonstrated during the Covid-19 crisis. In his report ” State of the Industry Report on Mobile Money 2021 », The World Association of Telephone Operators (GSMA) reveals that Africa remained the leader in Mobile Money in 2020. The segment recorded further growth. The number of accounts increased by 12%, from 469 million in 2019 to 548 million accounts in 2020. The volume of financial transactions grew by 15%, from 23.8 billion to 27.4 billion. The financial value of transactions also increased, by 23%, from 456.3 billion USD to 490 billion USD in 2020. Sub-Saharan Africa hosted 45.67% of registered Mobile Money accounts worldwide and generated 63.89 % of the value of these global financial transactions which amounted to 767 billion USD.
Sub-Saharan Africa hosted 45.67% of the registered Mobile Money accounts in the world and generated 63.89% of the value of these global financial transactions which amounted to 767 billion USD.
Mats Granryd, CEO of GSMA, explains that “ when the Covid-19 pandemic took hold in early 2020, it quickly became clear that mobile technology, and mobile money in particular, would have an inordinate role in play to keep people connected, provide vital financial support, and provide a safe, contactless way to pay for food, electricity and other essentials. With more than $ 2 billion in transactions every day, mobile money has become a new daily routine for millions of people around the world ”.
During the Covid-19 crisis, many African governments like Kenya, Ghana, Rwanda, Cameroon and Gabon, encouraged their populations to adopt mobile payment to curb the spread of the virus during exchanges physical. The pandemic has once again demonstrated the urgency of interoperability of mobile financial services, already implemented in several East African countries, which would greatly benefit the economic growth of the continent where the banking rate remains low. but where Mobile Money suggests great opportunities for booming segments such as e-commerce.
The strong support that Mobile Money receives from various international organizations such as the Bill and Melinda Gates Foundation, the Financial Sector Development Fund, the World Bank, the Alliance for Financial Inclusion (AFI) may well constrain regional financial institutions to seriously reconsider initiatives such as Mowali.