MTN MoMo expands into remittances, business payments

BREAKING NEWSOctober 2, 2023 at 12:08 PM UTC

Africa's largest mobile operator is making a significant move in the fintech sector, allowing its nine million mobile money subscribers to send money internationally and enabling businesses to accept payments through a mobile app.

This development comes in response to the limited banking infrastructure across the continent, prompting telecom companies to step into the expanding fintech arena. MTN South Africa, with approximately 9 million registered mobile money users since its relaunch in 2019, is targeting the roughly 15% of South Africans who remain unbanked.

MTN's fintech division encompasses 16 mobile money services, including MoMo, insurance, airtime lending, and e-commerce. Following an investment from Mastercard, CEO Ralph Mupita plans to explore opportunities to sell up to 30% of the business, which contributes nearly a fifth of the company's total revenues.

Key Takeaways

Across Africa, it is not just MTN that has lofty fintech ambitions. Safaricom, via M-Pesa, has dominated the Kenyan mobile money business for years. The telecom operator, alongside South Africa’s Vodacom, is also keen on separating its fintech arm from the traditional telecom business. From Airtel and Glo to Cell C and Afrimobile, there’s an incentive to push fintech activities for these telecommunications carriers in Africa because the continent is gradually shifting from primary voice and text mobile to digital services. The financial services these telecom operators offer see them compete with already established companies in Africa’s fintech space, including Interswitch, Flutterwave, Chipper Cash, and MFS Africa.