An estimated 18 million adults in the country use mobile phones to send or receive money but Bank of Tanzania Governor, Prof. Benno Ndulu has allayed fears that mobile money will render banks irrelevant in future.
BoT Governor, Benno Ndulu
Addressing delegates to 2013 Global Smart Partnership Dialogue being held in Dar es Salaam on Saturday evening, Professor Ndulu said mobile money is helping the majority rural people who have no access to banks to get banking services.
“Mobile phones have dramatically increased accounts from zero mobile money accounts five years ago to 28 million,” Prof. Ndulu said while stressing that commercial banks are now partnering with mobile phone service companies to take their services to rural masses.
“Mobile phone money is transforming Africa because the spread is happening faster,” he noted saying local banks such as CRDB Plc and National Microfinance Bank are already using mobile phone companies as branches where their clients can deposit and withdraw money.
Only between 12 and 15 per cent of the country’s 44 million people have access to banking services which are mostly restricted to urban areas. The central bank chief however warned that while mobile phone money service is becoming popular, governments in East Africa should refrain from imposing unnecessary taxes on the service.
“Let’s not start milking the cow before it has grown up fully,” Prof. Ndulu warned as lawmakers in the just ended budget session shot down an attempt by Finance Minister, Dr William Mgimwa to introduce new taxes on mobile phone money transfer services. Former Bank of Zambia Governor, Dr Caleb Fundanga, said mobile phones should help to mobilize savings from the majority of the people to nurture a saving culture in African countries.
Dr Fundanga said governments should include financial inclusion in their National Development Visions. He challenged governments and local scientists to develop software that will be used by mobile money transfer services because currently it is costing consumers very high by using foreign developed software.
“If we develop local software for the transactions then we will reduce the cost of the service,” noted Fundanga who touted financial inclusion through mobile money services. Zimbabwe”s Deputy Prime Minister, Prof. Arthur Mutambala, said that mobile phone money services have transformed Africa hence testifying that foreign technologies are being utilized for development on the continent.
“Mobile phone money has shown that even the most advanced technologies are relevant in Africa,” Prof. Mutambala noted. Participants to the event, which officially ends in Dar es Salaam today, said there is need for governments to employ technology to ensure that the majority of the people who are rural based get access to financial services.
By FINNIGAN WA SIMBEYE, Tanzania Daily News
