MTN has expanded its Mobile Money (MoMo) fintech offering’s remittance network by adding 25 new wallet corridors across 10 African countries, taking its total remittance network on the continent to 200 million wallets across 24 countries.
“This move is especially beneficial for migrant communities in South Africa who send money home to Mozambique, Malawi and the Democratic Republic of Congo,” said Kagiso Mothibi, GM for fintech products and services at MTN South Africa, on Monday.
According to Mothibi, the newly enabled corridors include links between South Africa and the DRC, Ethiopia, Gabon, Kenya, Madagascar, Mozambique, Malawi, Senegal, Sierra Leone and Tanzania.
Payments originate in South Africa and only flow in an outbound direction because the functionality to send money from another location into South Africa has not yet been built.
“South Africa is a net sender, with about 90% outbound and 10% inbound. We will be launching inbound by the end of 2024 to address the remaining 10%,” Mothibi said.
To aid with interoperability, MTN has partnered with prominent fintech platform operators such as Orange, Tigo, M-Pesa and Airtel for wallet-to-wallet transactions. Wallet-to-cash functionality is also available.
MTN South Africa said that the exchange rate on remittance payments largely depends on the market rate that its partners get from their banks. The remittance functionality has been launched at a charge of 4% per transaction and all transfers are cleared immediately.
Neglected
The remittance market in Africa has long been neglected by the formal financial sector, forcing thousands of migrant workers to rely on risky cash-based methods to send money to family back home. Telecommunications companies such as MTN Group and its direct competitor Vodacom Group – with M-Pesa – are not the only businesses entering this lucrative market.
In February, BankservAfrica, the automated clearing house responsible for the PayShap system, announced that it had launched a similar offering called Transactions Cleared on an Immediate Basis (TCIB) to cater for remittance flows in the Southern African Development Community.
At the announcement of MTN Group’s financial results for the 2023 financial year in March, Sergine Dioum, group chief fintech officer, told TechCentral that MTN is working with regional initiatives such as TCIB and similar initiatives in East and West Africa to improve MoMo’s interoperability and reach.
Read: PayShap-style cross-border settlements coming to SADC
“By expanding our services to new markets and corridors, we are not only enabling individuals to support their families across borders but also driving economic empowerment and fostering greater financial resilience within communities,” said Mothibi. – © 2024 NewsCentral Media