Challenges faced by Mobile Financial Services in Ghana
Godwin Kwami Tamakloe is a Mobile Financial Service Professional with over 9 years of experience in the Mobile Money Industry and currently the Senior Manager, AML, Compliance and Analytics for MobileMoney Limited, a business responsible for mobile financial services for MTN Ghana. Prior to joining the Mobile Financial Service industry, he worked within the Banking, Insurance and Telecom industries.
He has worked in fairly diverse markets throughout Africa, the South Pacific and the Caribbean. This has provided him with in-depth knowledge and practical experience in various key areas like Compliance, Risk management & AML, Platform Implementation, Agent Channel Management, Customer Acquisition and Retention and Business Operations.
Godwin is an avid conference speaker within the Caribbean and the Latin Americas on Mobile Financial Services, Micro Finance, Regulations and Compliance in general. He is a certified Anti-Money Laundering Specialist, Associate Fraud Examiner and holds Masters degrees in Operations and Supply Chain and Project Management. He is passionate about learning and sharing his knowledge with like-minded professionals within the industry and other related industries.
Today, Mr Godwin accepted to meet the startup BACE Group and share more about some challenges they are facing in the African mobile money ecosystem. He has a wealth of experience in this industry and would be giving unalloyed insights into what is obtainable in the mobile money industry.
What is your work at MTN?
I work with MTN MobileMoney Limited as the Senior Manager in charge of compliance and Anti-Money Laundering. I double as the AMLRO (Anti-Money Laundering Reporting officer) for the business. My main responsibility is to make sure the business works within the confines of the law, meeting regulatory requirements, implementing an Anti-Money Laundering program in managing AML risk and fraud and supporting the business to achieve the commercial goal.
What is the difference between Mobile financial services (MFS) , Mobile banking (m-banking) and Mobile money (m-money) ?
Some use the two terms M-banking and m-money interchangeably. For me, Mobile Banking is a service offered by a financial institution which allows customers to perform financial transactions like transfers, payments etc via your mobile device. You can access full suite of banking services via mobile banking. Although, mobile money also allows customers to perform financial transactions via their mobile devices, I think there are some basic differences:
- You do not necessarily need a traditional bank account to access mobile money services but you do need a traditional bank account to access a mobile banking service. One is traditional bank account based and the other is not. It is one of the reason why we see mobile money as the main driver of financial inclusion as compared to mobile banking.
- Within the m-money, you have different business models allowed by the regulators:
- Bank Led
- MNO Led
- Hybrid
- Licensed Mobile Financial Service Provider
Mobile Financial Services encompasses both m-banking and m-money.
How is Mobile Financial Service providers taking advantage on the financial market in Ghana?
The growth in the use of mobile phones and the banks inability to offer certain customers better value has been one reason why Mobile Money has developed in our part of the world. Unfortunately, our traditional banks in our part of the world has not been able to crack what the needs of the customers are to meet such needs. The result is the segment of the economy one would call the “financially excluded”. Access to financial services are concentrated mostly in the cities with banks seeking to minimize their operating cost. The opportunity there is that huge number of customers who are financially active on daily basis but do not transaction via the traditional banking system can now have that opportunity via Mobile Money.
How is mobile financial services increasing financial inclusion in Ghana market?
Mobile Financial Services is growing very fast in Ghana due to the commitment of various stakeholders to deliver the value the customer seeks. Today, MTN MoMo offers the service right at the doorstep of the customers. The presence, visibility and the liquidity of our agent network helps deliver the convenience and speed the customer needs. Services like micro loans, savings, micro insurance, informal pensions, international remittances among others we offer via our mobile money platform give the customer variety of services to choose from. The regulator has also been very responsive within the service evolution process by implementing the necessary regulations at the right time to create that conducive environment for the growth of the service. Also, the investment made and still being made in growing the service by MTN has contributed immensely to where we are today. Over 8 million, 30 days active customers who are performing a daily average of 5 million transactions and a billion transactions value.
What are the challenges that mobile money operators are facing in Ghana?
- Transaction Limits are still low at the point which affects those who would want to transact more.
- Lack of constant liquidity flow in the channel around pocket of places in some district and villages.
- Socially engineered fraud typologies
- Absence of a National ID
Do you have any problems related to KYC (Know your customer) in mobile services?
In general, residential addresses in Ghana is an issue we face within the financial industry. Customers are not able to give a specific location as their residence and it becomes difficult getting to such customers where there are issues. We also encounter some cases where some customers seek to open an account with fake photo ID’s.
What is your AML strategy? How are you stopping fraudsters?
As a business, we are deeply committed to preventing, detecting and prosecuting money laundering and terrorist financing activities. We all know that Financial crime threatens the safety of our society, the integrity of our financial system, and the stability of our economy. We have therefore put in place an institutional framework to supervise, gather intelligence on, and take all necessary action against financial crimes.
Our AML/CFT Strategy is a major step forward in our fight against money laundering and terrorist financing via our platform. The Strategy has been defined and based on the findings of the Risk Assessment to address the business’ highest risks and institutional weaknesses. It is a comprehensive exercise that covers all key elements of our AML framework: from establishing an AML program, supervision and intelligence gathering to investigation and to reporting to the relevant regulatory body (Financial Intelligence Centre), education and training among others.
