UPDATE GIGS MEDIAUPDATE GIGS MEDIA
  • Home
  • Entertainment
  • Business & Finance
  • Education
    • Scholarships
  • Lifestyle
    • Health & Fitness
    • Travel
    • Dating & Relationships
    • Do it yourself
  • Tech
  • Privacy Policy
Facebook Twitter Instagram
Facebook Twitter Instagram
UPDATE GIGS MEDIAUPDATE GIGS MEDIA
CONTACT US
  • Home
  • Entertainment
  • Business & Finance
  • Education
    • Scholarships
  • Lifestyle
    • Health & Fitness
    • Travel
    • Dating & Relationships
    • Do it yourself
  • Tech
  • Privacy Policy
UPDATE GIGS MEDIAUPDATE GIGS MEDIA
Home » Why MFS Africa is piloting its latest remittance play in Madagascar
Tech

Why MFS Africa is piloting its latest remittance play in Madagascar

adminBy adminMarch 8, 2023No Comments4 Mins Read
Facebook Twitter LinkedIn Telegram Pinterest Tumblr Reddit Email
Lake_Anosy_Central_Antananarivo_Capital_of_Madagascar_Photo_by_Sascha_Grabow.jpg
Share
Facebook Twitter LinkedIn Pinterest Email


MFS Africa, the largest pan-African digital payments network, announced last week that it is partnering with Western Union to power the cross-border flow of money from over 200 territories into Africa, starting with Madagascar. The company’s decision to pilot such an important service in a relatively small market where its footprint is lighter has raised questions among several fintech enthusiasts across the continent.

Having played in the remittance industry for years alongside gritty competitors like NALA, Pesapeer, and Afriex, MFS Africa might glean some more competitive advantage from partnering with the global money transfer behemoth Western Union. Yet, the question remains: why pilot with Madagascar?

Madagascar is bullish on mobile money 

Like its East African neighbours Kenya and Tanzania, Madagascar is riding a mobile money wave that has seen traditional banking lag behind in the region. Between 2013 and 2016, mobile money subscriptions doubled to reach over 4.6 million users, a fifth of the population at the time. Within the same period, less than a million Madagascans operated bank accounts. This reflects the state-wide preference for mobile banking solutions. 

Madagascar, a largely rural country with a prime focus on agriculture, is sparsely populated. The country averages only about 36 inhabitants per square metre, making it difficult for traditional banks to set up branches near users as that would hardly be cost-effective. This disadvantage, however, proved to be a boon for telcos—like Telma, Orange, and Airtel—who began to power financial services in the region. Soon after, banks started playing catchup with agency banking solutions. 

According to the International Finance Corporation (IFC), Madagascar now has over ten million mobile money users, representing over a third of its population. That number is set to grow as more Madagascans get comfortable with the suite of solutions mobile money has evolved to offer in the region—including payments, savings, wallet management, and paperless credit facilities. 

To make this happen, mobile money operators have had to partner with financial institutions and innovate financial inclusion projects that impact grassroots communities. Airtel and Bank of Africa teamed up to provide financial services to farmers, the traditional bank clientele, while Orange partnered with Première Agence de Micro-Finance (PAMF) to provide microloans. 

Speaking to the success of mobile money credit products in Madagascar, Mathieu Berthelot, CEO of Orange Money Madagascar, said, “Madagascar is among the African and Indian Ocean countries where digital credit products, going from just a few dollars to several hundred dollars, have been the most successful.” 

Advertisements
Advertisements

“Mobile money has already become the main tool for financial inclusion in Madagascar and it has been a game changer for so many people,” he added,

Madagascar demands, France supplies

Madagascar might be a relatively smaller African market, but its historical connection to France, its coloniser and major investor, makes it a hotspot for remittances from France. Also, Western Union, though an American company, operates a huge market in France, thereby creating a wide-enough pool of potential users for the pilot phase in Madagascar. 

“[Madagascar is] also a big receiver of remittances from France – traditionally a strong market for Western Union,” MFS Africa’s Managing Director, MTOs, Kumar Shourav, said to TechCabal. “Eventually we will roll out this partnership to cover all countries in Africa through MFS Africa’s strong and direct connection with mobile wallet players in all these markets,” Shourav added.

In addition, Shourav confirmed to TechCabal that before this partnership, Western Union did not have an existing connection with the mega mobile money operators in Madagascar, such as Airtel Money and Orange Money. But now, by connecting to MFS Africa’s ever-expanding API suite, the global money transfer behemoth can facilitate instant remittances into Malagasy wallets. 

Over the past 5 years, MFS Africa has doubled down on its vision to solve the fragmentation in Africa’s money transfer market and “provide an API that makes Africa look like one country.” Global names including MoneyGram, WorldRemit, and Xoom, Paypal’s money remittance service, have plugged into MFS Africa’s vast interoperable network of money transfer companies.

Presently, MFS Africa reportedly connects over 400 million mobile money wallets and 200 million bank accounts across 35 African countries, with a vision to cover the whole of  Africa in years to come. 

“We want to make sure there is always a digital pathway for a phone number to receive money in Africa,” Dare Okoudjou, MFS Africa’s CEO, said to TechCabal. 

Get the best African tech newsletters in your inbox

More latest updates

  • PE-backed Medius acquires Expensya | TechCabal
    PE-backed Medius acquires Expensya | TechCabal
    by admin●June 8, 2023
  • Tingo Group will respond to Hindenburg research’s claims today
    Tingo Group will respond to Hindenburg research’s claims today
    by admin●June 7, 2023
  • Twiga confirms layoff of entire sales team as it changes commercial model
    Twiga confirms layoff of entire sales team as it changes commercial model
    by admin●June 7, 2023
  • NIBBS reduces processing fees for banking transactions
    NIBBS reduces processing fees for banking transactions
    by admin●June 7, 2023

Share this:

  • Tweet
Advertisements

Advertisements

Related

Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
admin
  • Website

Related Posts

CBN governor’s office under investigation following Emefiele’s suspension

June 9, 2023

President Tinubu’s suspension of CBN Governor Godwin Emefiele raises legal questions

June 9, 2023

Israeli AI startup Ravin enters SA market

June 9, 2023

Can streaming platforms solve Nollywood’s distribution problem?

June 9, 2023

Ride-hailing drivers in Nigeria unimpressed by Bolt’s new N6000 bonus

June 9, 2023

Tingo denies Hinderburg allegations, appoints independent counsel

June 9, 2023
Stay In Touch
  • Facebook
  • Twitter
  • Instagram
  • YouTube
Don't Miss
Tech

Has NFT found its biggest mainstream proponent yet in Africa?

By adminApril 13, 2022

The past few days have been good for NFT in Africa—Nigeria and Ghana, to be…

Share this:

  • Tweet

👨🏿‍🚀 TechCabal Daily – MTN is accelerating mobile money in Nigeria

April 13, 2022

Didi shuts down operations in South Africa

April 13, 2022

Back from the future: How embedded finance changed the world

April 13, 2022

Can Hytch succeed where GoMyWay failed?

April 13, 2022

More African central banks are considering digital currencies

April 13, 2022

This bootstrapped drone startup is promoting smart farming in Zimbabwe

April 13, 2022

The Next Wave: Africa does not know itself

April 13, 2022

TechCabal Daily – Kenya’s new law for content creators

April 14, 2022

INDUSTRY EXPERTS DISCUSS THE GROWTH AND FUTURE OF FINTECH IN NIGERIA AND INDIA IN SYMPOSIUM BY CLI COLLEGE, NIGERIA AND CHRIST UNIVERSITY, INDIA

April 14, 2022

28 days after launching investment arm, Luno crosses 10m user base

April 14, 2022

👨🏿‍🚀 TechCabal Daily – The war for Twitter

April 15, 2022

Digital Nomads: Julian Owusu’s journey from football to fintech

April 15, 2022

In the wake of explosive accusations against Africa’s most valuable startup, Flutterwave co-founder speaks

April 16, 2022
Advertise with us
update gigs advert images
LATEST

CBN governor’s office under investigation following Emefiele’s suspension

June 9, 2023

President Tinubu’s suspension of CBN Governor Godwin Emefiele raises legal questions

June 9, 2023

Israeli AI startup Ravin enters SA market

June 9, 2023
About Us
About Us

We are dedicated to bringing you news from around the world that is entertaining, educative, informative and self inspiring.. Your source for the lifestyle news.

We're accepting new partnerships right now.

Email Us: updatemedia050@gmail.com

Subscribe to Updates

Get the latest news from Update Gigs Media about entertainment, sports, lifestyle, art, design and business.

Facebook Twitter Instagram
© 2023 Designed by Ntechy Digital System.

Type above and press Enter to search. Press Esc to cancel.