MTN Nigeria launches money transfer service

The success in M-Pesa‘s East Africa, Kenya’s Safaricom mobile money unit, has convinced investors and the industry that financial services are another growth area for the telecommunications sector, where prices for basic services are falling.

Nigeria said it would allow telecom companies to provide banking services last year, aiming to give millions of Nigerians without a bank account access to mobile money services.

MTN Nigeria was granted a license by the central bank of Nigeria in July to provide financial services.

Nigeria’s largest telecom firm MTN has launched a money transfer service targeting those without bank accounts, and said on Thursday it plans to become a payment services bank once it receives approval from the central bank.

Wholesale owned by MTN Group of South Africa, the company runs the largest mobile phone network in Nigeria serving about 56 million people.

MTN Nigeria CEO Ferdi Moolman said her unit Yello Digital Financial Services Limited (YDFS) will extend access to simple money transfer services and other financial services.

More than half of Nigeria’s population of 180 million does not have a bank account.

Shares in MTN Nigeria, which was listed on local stock exchanges in May, fell 1.49% to 144.50 naira on Thursday, valuing the telecommunications firm at 2.95 trillion naira ($ 9.64 billion).

MTN Group appointed Rob Shuter as Chief Executive Officer in 2016 to oversee the formulation of a new strategic growth plan and seek new revenue streams after competition and regulation hit profit margins.

Shuter, who has previous banking experience, has rebuilt Africa’s largest telecoms group, seeking returns on everything from financial services to music and video games./Investing.com

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