Mobile solutions are playing a critical role in the access of financial services in Africa. The rapid growth of mobile financial services raises issues of regulation and emerging risks in the mobile ecosystem. This was the motivation for a seminar which pulled officials from Central banks from across Southern and Eastern Africa as well as international experts who discussed various aspects of the mobile financial services (MFS). The theme for the seminar was Mobile Financial Services: the Business and Regulation fostering discussions on the regulation of this fastly growing business in the region. The event was organized jointly by the International Monetary Fund’s (IMF) Africa Regional Technical Assistance Center for Southern Africa–– AFRITAC South (AFS) and Africa Regional Technical Assistance Center for Eastern Africa—East AFRITAC (AFE).
Participants from Ethiopia, Mauritius, Rwanda, South Africa, Tanzania, and Zambia made presentations on the current state of the MFS business and the regulatory/oversight framework in their respective countries. Building on country presentations, the experts discussed with the participants business models used by the MFS providers, payment system issues, emerging risks generated by the growing scale of the MFS business, and the need for the appropriately tailored regulation and oversight of MFS, including provisions relating to anti-money laundering and combating financing of terrorism.
The regulatory and oversight framework for MFS is still developing. Mr. Googoolye, First Deputy Governor of the Bank of Mauritius, emphasized that in developing this framework it is important to take a comprehensive approach to regulating MFS and involve all the relevant stakeholders in the process. During the discussions of the optimal regulatory architecture, AMPI participants stressed the importance of balancing financial stability and integrity considerations with the need to foster MFS industry growth and financial inclusion of the unbanked population.
At the conclusion of the seminar, Mr. Kramarenko (AFS Coordinator) and Mr. Singh (AFE Coordinator) indicated that the seminar raised the awareness of the importance of cross-sectoral (that is, payment system oversight and banking supervision) and cross-border supervisory cooperation, which is vital for the achievement of safe and sound financial inclusion through MFS. They added that going forward AFS and AFE would facilitate peer-to-peer exchanges and provide further technical assistance to their member countries in the area of mobile banking, including on agency banking supervision.
Thirty-eight central bank officials attended from 19 AFS and AFE member countries: Angola, Botswana, Comoros, Eritrea, Ethiopia, Kenya, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Rwanda, Seychelles, South Africa, Tanzania, Uganda, Swaziland, Zambia, and Zimbabwe.