Mobile money – the use of cell phones for money transfers, payments and more sophisticated financial activities such as credit, savings, and insurance – is increasingly popular in East Africa. While it offers the potential for increased financial inclusion, it could benefit from region-wide rules to coordinate and harmonize regulations, UNCTAD study says.
The report, Mobile Money for Business Development in the East African Community: A Comparative Study of Existing Platforms and Regulations, focuses on the East African Community (EAC1) as a way of addressing wider issues raised by mobile money.
The study is of high relevance also to countries beyond East Africa. According to the GSM Association, which tracks mobile money deployments around the world, more than half (118) of the world's known mobile money systems had been implemented in Africa as of January 2014. As many as 37 of them were in 18 French-speaking countries.
UNCTAD stresses that ensuring mobile money services bring the desired broad benefits - especially to the poor - will require heightened coordination and cooperation across various regulatory and market sectors, such as telecommunications, banking and electronic commerce. Building consumer confidence and trust in the systems is essential, the report says.
Steps are needed to address concerns related to consumer protection, registration and transaction limits, regulatory collaboration and interoperability, meaning interconnection between telecommunication networks.