Banks Downtime; Silent War Between Telcos And Commercial Banks

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Another week and another bank in Africa is entering the mobile money space. Banks and Telcos may be worried about losing market share to the other, but in my opinion banks have much more of a right to question whether Telcos are legally permitted to deal directly with their customers under current regulation and pick up the business," New mobile products coming into the market promise to deepen financial inclusion even further. Some banks are soon going to introduce, its telecoms unit, that will allow customers to access credit loans, perform cross border money transfers and send and receive money from other commercial banks. And the market is there. Mobile money transfers claim 83% penetration in Nigerian and $23 billion passed through the platforms in 2020 alone, according to CBN equivalent to 42% of the country’s GDP. “Competition between banks and telcos will benefit end consumers and financial inclusion in general as mobile money has a platform to reach those who are not included “As long as pricing is low enough to include the unbanked, mobile money services and healthy competition will benefit consumers and increase financial inclusion.” With Bank’s Telcom Unit proposing to be being free of charge and interoperable across banks and other mobile money services, Banks could challenge the dominance of its major player(MTN) in the market, especially since they charge a fee for the use of USSD. As proposed, increasingly in Africa, banks want to be in business with mobile phone companies, while telecom firms have, essentially, become financial institutions.

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