College of Humanities Hold Sixth Dialogue Series

The College of Humanities has held its sixth Dialogue Series for 2017 at the University of Ghana School of Law Auditorium. The round table discussions brought together speakers from the finance industry, namely Dr. Settor Amediku, Head Payment Systems Department, Bank of Ghana, Mr. Eli Hini, General Manager, MTN Mobile Financial Services, Mr. Berhold R.J. Gadagbui, Head, Mobile and Internet Banking Ecobank Ghana Limited, Professor Godfred A. Bokpin, Head, Department of Finance, University of Ghana Business School.  The dialogue was moderated by Dr. Charles Ackah, Senior Research Fellow, Institute of Statistical, Social and Economic Research (ISSER).

Mr. Eli Hini, General Manager for MTN Mobile Financial Services who was the moderator, set the tone on how mobile money has evolved in Ghana by tracing the history and origin of the Mobile Money Service which he said originated from Kenya ten (10) years ago. The popular TV commercial “mensakaoo” (I have received it), was launched in Ghana by MTN in July 2009.  He mentioned that the service had the initial support from three banks: Ecobank, CAL Bank and Fidelity Bank, adding that Mobile Money has evolved from a single focus on the local transfer of money to include payment of bills, fees, and international transfers. Additionally, the service allows an individual to link mobile money wallet to a bank account to purchase treasury bills.

According to Mr. Gadagbui, a representative of Ecobank in his presentation, ‘How mobile money has benefited his company (Ecobank) and the industry as a whole’, noted that banks derive a number of benefits from the mobile money transfer service. The objective of mobile money as a service, he noted, is to ensure financial inclusion in Africa. With reference to Ecobank, he stated that the bank collaborates with other banks to deliver the same services outside Ghana to neighboring countries such as Liberia, Cote d’Ivoire,, Togo and Benin.  This, he noted, has led to a reduction in the cost involved in providing the services to many more customers. Mr. Gadagbui said the service gives customers access to carry out convenient financial transactions and serves as a way of enhancing financial literacy in Ghana. He however acknowledged that the service has caused reduction in bank deposits.

Professor Godfred A. Bokpin, speaking on the evolution of the mobile industry in Ghana, highlighted the opportunities and threats facing the industry. Making reference of sources gathered from the literature, Prof. Bokpin said that the service of mobile money transfer was as far back operational in Mozambique in 2002.  Prof Bokpin stated that more than 70% of the population in Africa is unbanked. This he attributed to the lack of knowledge and acceptance of new developments in the financial services. He also asserted that the banking industry has not been able to transform the informal sector because it has not tapped into the large market of the sector.

The Financial Regulator’s Perspective was given by Dr. Settor Amediku who argued from a monetary policy angle. He said the Bank of Ghana provided the e-Money Issuers Guidelines in 2015 to facilitate the development of the service. This changed the concept by promoting partnerships between the banks and telecommunication companies (TELCOs).  He indicated that Ghana faces a fundamental problem when making monetary policy decisions because of the large informal sector. He noted that currently, there are 10.5 million bank accounts (including multiple accounts), as against 19 million mobile money accounts.  He was of the view that, it is important to move the money in the informal sector to the banks, so that monetary policy decisions will affect the entire market. ~Dr. Amediku said that although majority of the Ghanaian population is illiterate, with the advent of technology, they are able to access mobile money.  He called for the development of an effective payment system in order to address the many problems concerning monetary policy decisions.

On the challenges facing mobile money and telecommunication companies. Mr. Hini was emphatic that liquidity is a major problem for the mobile money agents.  He added that even though network instability was another problem measures are being put in place to curb the situation, noting that network instability may sometimes lead to fraud.  He further explained that the MTN network base was being expanded to provide quality network to all.   He ended his remarks, saying that a recent GMSA Report shows that about 40% of the adult population in Ghana actively use mobile money.  For his part, Mr. Gadagbui intimated the need to intensify education, create a register of agents and provide avenues for address issues with customer dissatisfaction with any aspect of the service.  Prof Bokpin on his part said the mobile money business is an emerging area and the business model should be well managed to the advantage of the customer. He congratulated the Bank of Ghana for their policy initiatives which has made Ghana a leader in the business in the sub-region.  He was looking forward to the day when for example the Ghana Revenue Authority will make it possible for companies to pay their taxes through the mobile money platform.

In his summary and concluding remarks, the Moderator observed that with 36 banks currently operational in the country, mobile money business may be the way to financial inclusion.  He argued for a more vigorous platform to address the challenges of education, the full deployment of the national identification system to combat fraud and money laundering and the coordinated efforts of the various stakeholders- banks, TELCOs, the regulator, to ensure that the customer derives satisfaction from patronizing the service.

The dialogue which was chaired by Professor Samuel Agyei-Mensah, Provost of the College of Humanities was attended by over 300 participants comprising students and faculty of the University, representatives from MTN, Bank of Ghana and Ecobank. The College Advisory Board was represented by Mr. Frank Adu Jnr., who is also the Managing Director of CAL Bank.