“Mobile Money Is Not A Threat To Banks”

 

Vodafone Ghana says the banking sector must not view the delivery of mobile money services by telecommunication companies as a threat. Extending financial services to majority of the unbanked has proved a daunting challenge for banking institutions in Ghana. Out of Ghana's population of 25.9 million, a whopping 18.13 million, representing 70 percent of the population, is unbanked. According to the World Bank, only 7.77million, representing 30 percent of Ghana's population have an account, or multiple accounts with banks in the country. The advent of technology and its correspondent mobile money platforms introduced by telecommunication companies is, however, contributing immensely in bridging the gap between the unbanked and financial services. These notwithstanding, the posture of banks to the growing phenomenon has been everything but encouraging. Some of the comments that have emerged point to a concern that telcos are fast becoming pseudo-banks and are performing functions that should remain the exclusive preserve of the traditional banks. Speaking at the 14th edition of the Ghana Banking Awards, Kenneth Gomado, Finance Director at Vodafone Ghana, said: “The relationship between banks and telcos today can best be described as a forced marriage. Whiles these fears are understandable, there is little if any evidence from around the world to back it. Insofar as Banks and Telcos are concerned on this matter, they are complementary not competitive. Banks should know that mobile money is not here to take away from the pie but to create and enlarge it”. The Finance Director also gave a subtle hint that Vodafone has formalised plans to introduce Vodafone Cash, a mobile money platform, to Ghana. Vodafone Cash would seek to draw inspiration from M-Pesa, Kenya’s revolutionary mobile money platform introduced by Vodafone in 2009. Currently M-Pesa has acquired nearly 17million active customers and as many as 186,000 agents worldwide. A total of more than US$1.1 billion worth of person-to-person transactions are made on a monthly basis.

Source: Peacefmonline.com