Mastercard and MTN Group have signed a multi-market agreement as they jointly unveiled a prepaid virtual card, targeted at the telco’s Mobile Money (MoMo) users to connect millions of people and small businesses across Africa to transact through secure mobile payments, expanding access to the benefits of the cashless digital economy.
The deal will allow MoMo users to transact at over 100 million points globally, while enabling smaller merchants to accept card payments, enhancing the MoMo platform’s instant cross-border money remittance services and capabilities.
This follows Mastercard and MTN’s recent agreement for a minority investment into MTN Group Fintech – the digital financial services arm of Africa’s largest mobile network operator – that concluded this month.
With MTN’s overall subscriber base at 290 million and 60 million active monthly MoMo (Mobile Money) wallets, the agreement will impact 13 markets in Africa including Benin, Cameroon, Cote d’Ivoire, Eswatini, Ghana, Liberia, Nigeria, Republic of Congo, Republic of Guinea, Rwanda, South Africa, Uganda, and Zambia.
Speaking on the collaboration, Amnah Ajmal, Executive Vice President, Market Development EEMEA, Mastercard said “Our innovation strategy is based on collaboration. We are very proud of our partnership with MTN that will enable digital commerce for millions of people in Africa. In addition, mobile money solutions can be greatly beneficial for SMEs, enabling growth through seamless commercial operations, wider payments acceptance, access to affordable credit, and secure digital tools.”
Africa is home to over 1.3 billion people and only about 43% are banked with over 90% of all payments and transactions made via cash. And of the total population, 45% have mobile money accounts. Over the past five years, Mastercard and MTN have joined together to support several mobile money programs across Africa, helping people to make payments through global platforms, thus bringing more people into the financial mainstream.
In his words, Serigne Dioum, Group CEO, MTN Fintech “When there is a mutual vision – in this case to bring access, progress, financial inclusion, and prosperity to people – the road to partnership is a simple one. We look forward to working with Mastercard as a partner that is also committed to the enablement of more people and businesses through the collaboration into best-in-class apps, superior user experiences, safe transactions, secure remittances, new use cases, and expanded acceptance.”
The collaboration will help strengthen local infrastructure for digital payments, support potential expansion of transactions in the future and drive financial inclusion through access to assets.A virtual and physical Mastercard companion card will be added to every MoMo wallet allowing users access to over 100 million acceptance locations globally enabling MTN to scale up internationally.
With this access, Mastercard will also be able to provide its cybersecurity solutions to MTN’s operations with the aim to increase customer loyalty and trust.
The agreement will enable SMEs with payments acceptance solutions such as Mastercard’s SME-in-a-Box, a low-cost payments solution that enables small business owners to move their businesses online and accept a range of digital payments from their customers.
SME owners will now be able to access solutions with the opportunity to set up an e-commerce shopfront, including QR enablement, Tap on Phone solutions and digital card acceptance. This aims to further elevate customer experience, reduce business costs, and open new avenues for growth and innovation.
Through the partnership, consumers will now have expanded reach for mobile money remittance services – both inward and cross-border remittances in Africa. The demand for international remittance services is growing with more than US$2 billion in daily processed transactions, equivalent to more than 40% of the GDP of Sub-Saharan Africa. International remittances via mobile-money wallets grew by 65% year over year in 2020 to around US$1 billion, with no signs of slowing.
Mastercard is committed to its work with multiple telecommunications network companies across the continent and around the world, to make financial inclusion a reality. The company has pledged to bring 1 billion people and 50 million SMEs into the global digital economy by 2025. The work to provide MTN’s consumers and SME customers with easy and secure solutions, platforms and tools is just one example of work to deliver on this goal.