MTN MoMo is a mobile money service that allows users to store, send, and receive money, and make purchases using their mobile phone. Now, the mobile money service is aiming big with a move to obtain banking license in South Africa.
Currently, MTN MoMo South Africa relies on African Bank as its primary core. However, securing a banking license from the South African Reserve Bank (SARB) to operate independently will allow MoMo to operate without relying on African Bank, granting MTN full control over its financial services.
If MoMo receives the banking license, financial services offerings will be stepped up. In other words, introduction of a broader range of services like loans and savings accounts, and support seamless cross-border transactions will be enabled.
Additionally, MoMo would retain more revenue by eliminating shared fees with its sponsor bank. The fintech will also attract more customers with enhanced offerings, and gain regulatory credibility by dealing directly with the country’s apex bank.
It also worth noting that SARB is developing a regulatory framework to enable fintechs and non-banking entities to directly access the national payment system. This is aimed toward enhancing financial inclusion for the millions of South Africans who still lack access to banking services.
Things to know about MTN MoMo
MTN MoMo has more than 11 million registered customers in South Africa, with 3 million active ones. The MTN’s subsidiary has also led the way in financial innovation; the fintech is the first non-bank entity to introduce PayShap, a real-time payment service.
More so, MTN’s MoMo partnership with MasterCard paved way for the fintech firm to offers a virtual cards across 13 African nations. Lastly, while MoMo already supports basic transactions like payments and transfers, a full banking licence would allow it to expand its offerings in South Africa.
