The Mobile Money (Momo) service has undoubtedly come to help businesses and lives in the country. Hitherto, monies were sent through people and the Post Office, and this came with its own associated risk.

Though the Ghanaian populace were slow in accepting the system, there has been tremendous increase in subscription over the years. This major achievement is however being ripped off by certain occurrences and decisions; and people are gradually losing interest in the system. So, even though Bank of Ghana (BOG) and the networks are proud to announce and celebrate the increase in subscription and the volumes of transactions, what they are not telling us is the percentage of these accounts that are active or dormant. Interest in mobile money is waning and the authorities and stakeholders better sit up to sustain it. We cannot afford to let the system collapse because it will be dire for the economy. Aside its core business as a money transfer medium, Momo provides employment for so many people (especially the youth) both directly and indirectly.

Having been in the industry for the past few years, I will like to explain some of the major challenges that the system is currently facing.

Fraud

We have recently seen an increase in fraudulent activities through mobile money. The modus operandi of the fraudsters are many and varied. Initially, they (fraudsters) could send you a text or call you that you’ve won some lottery so you needed to send them money to claim your prize. So the moment you send the money, they withdraw and get rid of their SIM so you can never reach them again.

Their recent strategy is to call you and tell you there is a problem with your account so they offer to help you. For instance, victims are told an amount they received in their account has been wrongly transferred as airtime and they offer to assist you convert it back to cash. They then ask you to get another phone so they can take you through the process, and if you are not conversant with the system (like most users who do not understand English properly and hence cannot figure out what they may be doing) they make you generate a code for an ATM withdrawal or you send money to their phones and they bolt with it.

Others also call and tell their victims they have wrongly sent money to their account so they beg you in the name of all the deities to send it back to them, and once you do, they withdraw immediately and get rid of their SIMs.

What is worrying is that, the system does not insist/demand enough valid information before transactions/registrations will be completed. The system as at now, accepts any set of numbers for an ID without verifying to confirm name with ID numbers. Hence the fraudsters, comfortably get a new SIM and register with same ID and yet the network companies can’t scan through their system to help arrest these people.

It is important we get the system to verify names with ID numbers so people will not present fake IDs for registration. The networks can further scan through their system to find out if a particular ID has multiple registration and enquire why it is so, because most of these multiple registrations are the people behind these activities. They perpetuate their crime and get rid of the SIM and use another. A step further will be blacklisting certain IDs so it can never make another registration anywhere.

It is also worth mentioning that, this behavior of improper SIM registration is what led to the fining of MTN Nigeria some time ago. NCA should thus get the networks to do the proper thing.

These fraudulent activities are making mobile money very unattractive, people who do not understand the system, think money can vanish from your account without your notice or approval hence do not want to use it anymore. The efforts being put up to curb this menace will therefore need to be augmented by a collaboration amongst the networks, NCA and NCCE (since it’s a national issue) to educate the public in different languages on these occurrences.

Cost of transactions

At the initial stages of introducing the system, users thought it was expensive, but considering the amount of time you will stay in a queue at a bank, people later agreed it was worth it, since time is money. At a time that there’s a consideration to review cost of foreign transfers, domestic transfers are rather getting expensive, thus pushing people back into the banking halls. In 2016, the network companies brought a policy which according to them, was part of BoG’s regulation.

They indicated the regulation to be that, the system could not be used for direct transfers; so customers will have to load their accounts before they can transfer to someone else, this they justify it with money laundering issues.

Now; 1. Is BoG and the network companies telling us that if I want to transfer money to a business partner at a bank, I necessarily need to deposit it in my bank account before I further transfer it to its destination? And if I don’t have an account then I can’t do it?

2. Assuming, without admitting that case (1) above is right, how many of Mobile Money account holders (especially, many of our market women who only use their phones for calls) can do transfers themselves on their phones; is KYC being considered here?

3. Or is BoG and the networks saying mobile money is not a money transfer system but a savings module? Clearly these decisions were taken to help the network companies get some revenue to commensurate for the interest they were directed to pay. Though this is understandable, because the system needs to be sustained, but the manner in which they are being executed is flawed.

Now agents/merchants charge indiscriminately, and these charges do not even get to the network companies, neither does government get to tax these charges too. Everywhere in the world, money transfer systems do not charge at both sending and receiving ends (not even foreign transfers) why are we encouraging agents/merchants to perpetuate this illegality. And patrons of the service cannot insist on the right thing because, they will be charged anyway if they have to transfer from their own accounts. Why can’t the networks push all charges to one end and probably review it downward a bit so there can be a win-win situation for users (customers, agents and the networks).

To make matters worse, one of the major players in the industry, MTN, recently brought a policy not to suspend accounts should a wrong transaction be done. This means that, when money hits the wrong account and at the time of reversal it has been withdrawn, MTN cannot be held liable; and the excuse given once again is: “as part of BoG’s requirements.”

Most, if not all banking software have excel backgrounds (of which rows can be frozen) so, if other networks can freeze transactions (in a row), why can’t MTN do same but will rather suspend a whole account and cause unnecessary problems between the company and its clients. People are beginning to lose a lot of money as a result of this. Does MTN seriously think that a customer who loses money through this situation, with MTN not being able to help retrieve it, use the system again?

We don’t expect the system to be perfect, but these major challenges, if not addressed immediately, will gradually collapse the system.