Its Digital Africa!
Mobile money has been a stupendous success in Africa. Indias telecom companies will have to learn a lot from the model if they want to make a mark.
- May 13, 2017,
- Updated May 17, 2017 12:09 PM IST
Rudra Mukherjee, an unapologetic hunter for online bargains, has been using mobile wallets for three years. Even though he has dozens of apps on his phone - Moto G5 Plus, which he bought from Flipkart - he's sagacious enough to not give space to apps that don't offer deals. "I have Paytm and MobiKwik mobile wallets because of cashbacks they give on mobile recharges, purchase of movie tickets and online shopping," he says. "I had Airtel Money also, but removed it. It doesn't have as many features as Paytm," he says.
Mukherjee doesn't splurge. He spends about Rs 10,000 a year online, but that's not atypical for a 20-year-old student. With time, this is likely to rise, but services such as M-Pesa and Airtel Money seem to be lagging in tapping people such as him - in sharp contrast to the money transfer revolution they have brought about in Africa. For instance, the Sub-Saharan region has 277 million registered users of mobile money, more than the number of bank accounts. More than 40 per cent adult population in Kenya, Tanzania, Zimbabwe, Ghana, Uganda and Namibia is using mobile money actively. Kenya, which has 46.05 million people, or 0.04 per cent of India's population, has about 19 million M-Pesa users, compared with 16.4 million in India.
There are several reasons for such contrasting performances, such as the risk of theft and steep bank charges in Africa. Also, The uptick of mobile money services of telecom companies has been slow in India due to aggressive cashback programmes of non-telecom operators (such as Paytm and MobiKwik), high transaction costs, especially in case of payments banks, and limited application of mobile wallets for consumers and businesses.
Still, there are things that Indian companies as well as regulators can learn from the Africa experience - not the least of which is light regulation and the need to innovate and offer solutions to specific local problems.
Rudra Mukherjee, an unapologetic hunter for online bargains, has been using mobile wallets for three years. Even though he has dozens of apps on his phone - Moto G5 Plus, which he bought from Flipkart - he's sagacious enough to not give space to apps that don't offer deals. "I have Paytm and MobiKwik mobile wallets because of cashbacks they give on mobile recharges, purchase of movie tickets and online shopping," he says. "I had Airtel Money also, but removed it. It doesn't have as many features as Paytm," he says.
Mukherjee doesn't splurge. He spends about Rs 10,000 a year online, but that's not atypical for a 20-year-old student. With time, this is likely to rise, but services such as M-Pesa and Airtel Money seem to be lagging in tapping people such as him - in sharp contrast to the money transfer revolution they have brought about in Africa. For instance, the Sub-Saharan region has 277 million registered users of mobile money, more than the number of bank accounts. More than 40 per cent adult population in Kenya, Tanzania, Zimbabwe, Ghana, Uganda and Namibia is using mobile money actively. Kenya, which has 46.05 million people, or 0.04 per cent of India's population, has about 19 million M-Pesa users, compared with 16.4 million in India.
There are several reasons for such contrasting performances, such as the risk of theft and steep bank charges in Africa. Also, The uptick of mobile money services of telecom companies has been slow in India due to aggressive cashback programmes of non-telecom operators (such as Paytm and MobiKwik), high transaction costs, especially in case of payments banks, and limited application of mobile wallets for consumers and businesses.
Still, there are things that Indian companies as well as regulators can learn from the Africa experience - not the least of which is light regulation and the need to innovate and offer solutions to specific local problems.