Phone banking service launched in Africa, Mideast
South African mobile phone operator MTN on Monday said it was launching a banking service on mobile phones in 21 African and Middle East countries where access to traditional banks is poor.
"We have launched this service in South Africa in 2005," Dare Okoudjou of MTN's mobile phone banking department told AFP.
"But it wasn't a full bank account with the mobile phone at the primary access, it was very focused on key basic services, such as money transfer," he said of the South African service.
Now MTN is planning to offer a fully-fledged bank account on mobile phones called MTN MobileMoney which will allow users to pay for purchases or check balances. A credit card will be optional.
MTN calls the service "a convenient, secure and affordable way for MTN subscribers to send money, buy airtime and pay bills using their cellphone".
The service will be extended to the other 20 countries where MTN operates including Uganda, Nigeria, Cameroon and Ivory Coast which have a combined 90 million mobile phone users.
MTN said it signed a 9.7-million-dollar (7.5-million-euro) deal with Fundamo, a South African-based specialist provider of enterprise mobile financial services software.
British mobile phone giant Vodafone and France's Orange are already active in the market.
"In Benin, banking penetration is about one percent of the population, compared to 1,5 million telecom lines," or 18 percent of the total population, said Okoudjou, hinting at a potentially lucrative market segment for the mobile banking service.
In the Middle East banks are more widespread and the new service could be complementary.
According to a recent study by telecom analyst firm Berg Insight the service could be potentially used by 913 million people by 2014, against 20 million today.
The Gobal System of Mobile Communications (GSM) association, which represents the interests of the worldwide mobile communications industry in more than 200 countries, in February launched 20 mobile phone banking services in Asia, Africa and South America.
It has said that these services had a market potential of five billion dollars by 2012.