The money pushed through mobile money service platforms has more than doubled over the past year.
According to John Rwangombwa, the governor of the National Bank of Rwanda (BNR), over Rwf330b (about $492.3m) was pushed through mobile money platforms last year, a 105 per cent increase from Rwf161b (about $240.2m) recorded in 2012.
The governor also said the central bank recorded 57 million transactions through mobile money platforms during the year, a 159 per cent increase compared to the 22 million transactions recorded in 2012.
He noted that the figures show that mobile financial services are an essential product in our race towards financial inclusion.
“The Rwf330b that was channelled through mobile financial services was mainly for upcountry people. This is a good development because it also eases the cost of doing business and reduces households’ operational costs as one saves money they would have spent on transport to physically deliver the money,” he explained.
Rwangombwa was speaking during the commercial launch of a partnership between Airtel and I&M Bank, where airtel money subscribers will be able to withdraw cash at the bank’s Automated Teller machine (ATM) using their phones, at the Kigali Serena Hotel service on Thursday.
He added that the services also helped the central bank reduce the ratio of broad money and money in circulation, thus enhancing Rwanda’s efforts towards attaining a cash-less economy.
The latest BNR monetary policy and financial stability statement released last week indicates that the currency in circulation to broad money ratio continued to decline last year, from 12 per cent in 2012 to 11.3 per cent over the year. This indicates the positive impact of using modern payments systems, and extension of the financial sector network, particularly in the rural areas.
Last year, Airtel partnered with I&M Bank and RSwitch to develop an integrated service that would allow airtel money clients to access cash on their mobile money account or I&M Bank account through an ATM machine. RSwitch is the only firm that facilitates all electronic payments in the country.
“Airtel and I&M Bank being the first to launch this in the market gives them an upper hand over their competitors as there may be more people in Rwanda using mobile financial services platforms than their clients,” he said.
The governor said the central bank has regulations to facilitate such innovations and urged other telecom operators and banks to come on board.
Sanjeev Anand, I&M Bank Rwanda managing director, said the platform, which allows mobile-to-bank and bank-to-mobile transactions, is instrumental in extending financial services to the under-banked segment of society, which comprises of the 19.2 per cent formally unbanked, and 29.8 per cent that uses informal financial services like village savings schemes.
“It’s remarkable that even those people without bank accounts will now be able to use ATMs.”
The service is a platform that will support more merchant payments, bulk payments, and virtual money transfers.
Over 30 per cent of both MTN and Tigo subscribers use mobile money transfer services, signifying tight competition.
The three telecoms, with commercial banks that offer mobile banking services, are in a race to get highest number of all 11 million Rwandans on their mobile financial service platform.
Rwangombwa also challenged the parties to introduce mobile saving products, where clients would be able to accrue an interest on their savings, thus boosting the saving culture among the public.
“We are proud to spearhead new dimensions in mobile commerce through partnering with banks and telecoms to continue giving the public unparalleled access to mobile commerce services,” he said.
Rwangombwa said they had already authorised two of the three telecom companies, MTN and Tigo, to facilitate cross-border mobile money transfers.