Slowly yet surely, innovation(digital) is taking ground in the Ethiopian market for real. Over the years, reliable and easily accessible
payment option has been one of the real bottlenecks to translate innovation in to value
especially for digital products and services. tele
birr is here now as a real opportunity at Ethiopian
youth’s disposal.
The business environment has
been in clear lack of innovations over the years due to the fact that there were
not sufficient incentives to do so in the market place. As witnessed in neighboring
countries, mobile money applications such as tele birr are real recipes for financial inclusion particularly to the rural mass of the
Ethiopian population who would not otherwise be connected to any financial instruments
for many years to come. As the financial inclusion fosters across the country
as the result of the application of tele birr, increased and new
demands emerge for products and services.
With an innovative business mindset
anchoring on solutions for existing and emerging problems of the society, the growing
young population shall seize this opportunity further supporting and revitalizing
the business environment creating more jobs and paying for itself. In fact, my biggest
hope is that the youth will refocus on the things that matter in life than the
usual ongoing less useful discourse of senseless politics.
For example, a time has come
for anyone living in cities and urban areas, even diasporas, to pay for the monthly electricity bills of Pay
As You Go systems to support families and relatives in the off-grid areas if
rural households cannot pay for their own electricity usage at all. Access to energy(SDG7) goals being served as a result. Similar business models
can also be expanded to other productive sectors such as agriculture to spread
the upfront costs of productive use equipment over many periods creating opportunities to try new economic
activities and improve overall production leveraging the more reliable mobile money installments.
Ethio telecom will enable more than 44 million customers to deposit, withdraw and transfer money using an app and a USSD code. To access the service, customers can just dial *127# and has a capacity of processing 100 transactions in a second, addisfortune reported.
There is no doubt that the competition for similar payment platforms will soar in the months and years ahead which by itself will drive further innovation until the market settles with few winners. While tele birr still presents collaboration opportunities among banks, I think, it is time for Ethiopian Banks and similar mobile money providers to buckle up and try new innovations as well. Luckily, they are saved by introduction of only local counterparts for now. The next phase of competition, as foreign counterparts are allowed to operate in the mobile money space, will further erode the related often static and unreliable services(hence revenue) unless matched by competitive action from their end.
If there is any bigger cost associated with mobile money in Ethiopia, as much as other development interventions, it is the cost of not having an effective and reachable one thus far.
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Comments
1. Larger geographic coverage and already established network of agents/airtime sellers for that matter,
2. Lower transaction cost as it involves the operator and agent/user which is a benefit to the lower segment of the population cost wise-_ clear advantage of scale
3. No Interoperability issue as the transaction is from mobile no to mobile no. There would also be collaboration between banks and telebirr
4. Convenience: You don’t have to have a bank account or visit a branch office to register to the services. phone numbers are used as the user’s account number. In fact, I just activate telebirr without visiting any branch or obtaining support( virtual guide)
5. Technology and investment: it is easier for the operator to invest at scale for additional services as the technology evolves. It could also be an incentive for the operator to expand the network coverage further which again reinforces the expansion of telebirr services. With the exception of the banks, other mobile money service providers have regulatory uncertainty which is problematic for additional invest
6. Reliability: depend on the infrastructure of the operator. No third party infrastructure involved
7. Security: mobile money account mobile no and bank account mobile no could be separated.
8. Simplicity: the interface is simple and straightforward.
9. Easier communication(SMS) between ethiotelecome, tele birr operator, and users just in case there is an issue with telebirr platform.
10. Given the wider coverage of mobile infrastructure across the country, tele birr will create an opportunity for the government to reach out to the lower bracket of the population directly for lifeline/ safety-net interventions during pandemic or when there is an economic stress.
Kenya's M-Pesa is a clear showcase for the impact of mobile money such as telebirr