KAMAYOYO Kelvin, Zambian Economist, Scholar, BuyZed Technical Advisor, notes that taking a random human physical walk around highly densely populated Townships such as Chilenje, Kalingalinga and Mtendere one is likely to observe a growing worrisome number of stand-alone closed or non-operational mobile money transfer booths today. Most of the stand-alone mobile money transfer booths are located along the road sides and at least in every 100 metres there is more than 2 booths and of which 50 per cent of them would be seen to be non-operational or closed. Astonishingly, some of the mobile money transfer booths are being transformed into miniature road-sides open stores for selling products such as popcorns, vitumbuwa, cigarettes, fruits, vegetables or any other commodity which was not initially intended for the purpose. This is sadly unprecedented and unfortunate situation too.
Henceforth, this should be taken seriously by mobile network operators who should urgently review their mobile money transfer services business model with particular focus on assessing the prevailing downstream market characteristics and industry agent participation vis-à-vis survival rate of stand-alone mobile money booths in township areas across the country. The growing number of indolent stand-alone mobile money transfer booths should be a vivid source of concern to the different stakeholders particularly the mobile network operators, local authorities and communities. This is because in the long-run this unfortunate emerging occurrence could negate the growth of the national e-commerce, slow financial inclusion efforts and capable of inducing undetermined social behavioural changes in the adversely affected communities. The indolent mobile money transfers booths especially on the road-sides should therefore be removed before they are turned into safe housing or places for potential attackers of innocent citizens and also become an environmental menace.
Today, the mobile banking technology is increasingly becoming beneficial to individuals, small businesses as well as the banking industry in Zambia. Apparently, in the last 5 years Zambia has recorded substantial growth in the mobile money or cash transfer services through the platform of mobile network providers. The growth of mobile money transfer services is largely being spearheaded by mobile network operators such as Airtel, MTN and Zamtel companies. For instance, according to the Zambia Information and Technology Authority (ZICTA) ICT Sector Annual Market Report (2021), ‘‘mobile money transactions in the country leaped to an historic high of over K105 billion in 2020 compared to just K49.6 billion in 2019, representing a 113 per cent hike.’’
The relevant product market of mobile money transfer services has also embraced product diversification through fostering mobile banking or savings and a number of people have adopted the services with ease. When accessing mobile money services, the user is able to enjoy funds transfer, balance inquiry, DSTV payments, utility bill payments and other additional services. The mobile network operators have continued to make remarkable efforts to commercialize their services through setting up mobile money transfer booths in almost every township or compound area both in the urban and rural areas across the country. This has transformed the dowstream mobile money transfer market to be highly competitive with several agents but this is happening against the backbone of an upstream oligopoly market structure.
In the last 5 years there has been an influx of mobile booths across the country though this time around not providing mobile phone call services but mainly providing mobile money transfer services. Zambia has made significant strides in mobile money transfer services owing to a good foundation anchored on national digital transformation agenda which is being buttressed by digital financial services, digital infrastructure, digital skills, digital entrepreneurship, and a growing youthful population fond of digital platforms.
In simple terms, Mobile money is a digital payment platform installed in a Subscriber Identity Module (SIM) card of the device and can be used on regular and smartphone devices for transfer of money between cellphone devices. Unlike in the case of electronic banking services, the mobile money transfer services allows the users to send, withdraw and receive money without being connected to the formal banking systems. In other words, a person using a mobile phone is able to quickly transfer money at low cost without requiring access to an existing banking account.
Mobile money transfer services is today being flaunted as an avant-garde tool for increasing access to financial services in low resource environments especially in areas such as Townships where much of the population might be unbanked. Suffice to note that mobile money transfer services offer varied social and economic opportunities such as employment especially for the youths, easily facilitate families and friends financial support even when geographically distant, helps build financial resilience at household level to better respond to unforeseen negative events irrespective of time, improves the security of payments as well as enhance transparency, and remittances could greatly improve tax collection. In general, the development of the mobile money system could also foster formalization of the Zambian economy through integrating informal sector players into the formal banking and insurance systems.
It is therefore even more compelling for the mobile network operators and other stakeholders to consider conducting a national-wide comprehensive ‘‘Mobile Money Transfers and Market Performance Survey’’ to assess how wide-spread is the problem of stand-alone mobile money transfer booths closures and establish the driving factors in the relevant product market of mobile money transfer services. The Survey should also help to better understand what those mobile money agents are currently doing and basically conduct a close to exit-interview and use such data to inform positive change and market strategy re-alignment. Additionally, data collected would be critical to policy-making and programming for the prosperity of the ICT sector and digital financial services development in the country.
Apparently, the mobile money transfers booths that seem to be operating in Chilenje, Kalingalinga and Mtendere are mostly those that are integrated to another business which is already established as a retail shop or otherwise. In fact, today, it is no longer surprising that one would get mobile money transfer services from any individual, marketer, barbershop, salon or grocery shop just the same service one would get from the stand-alone mobile money transfer booth.
Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy of Melo Media Zambia.
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