BUSINESS TECHNOLOGY MEDIA FOR AFRICA

Rwanda telcos move to interconnect mobile money systems

Rwanda telcos move to interconnect mobile money systems
By Paul Adepoju
26 Jul 2018

From Rwanda, local telecoms operators Airtel, Tigo and MTN have approached the National Bank of Rwanda (NBR) for approval to introduce cross-network services.

The NBR, which has pushed for interoperability among mobile money service providers, is expected to approve the move.

According to operators, the interconnected platform will reduce the cost of transactions and "provide more convenience" to customers.

Interconnection/ cross-network services have increased in popularity, especially in regions like East Africa where operators in Kenya and Tanzania have interconnected their mobile money services.

There have been previous attempts made to interconnect mobile money services in Rwanda.

Tigo Rwanda and Airtel had interconnected Tigo Cash and Airtel Money, but failed to get MTN on board.

Experts believed MTN was trying to protect its market share and investment.

Arthur Rutagengwa, MTN Rwanda's mobile money head announced the operator has now agreed to interconnect its mobile money services with those of its competitors.

In preparation for the full implementation of interoperability in the finance sector, the Rwandan government has selected a spokehub model of interoperability under which an independent investor will operate a switch that facilitates off-net mobile money services.

John Karamuka, director of payment systems at the NBR, said, "The spokehub model has the advantage of economies of scale. We are not only linking mobile money operators but also banks and microfinance institutions."

Once regulatory approval is secured, operators will enter into commercial negotiations on transaction tariffs, among other considerations, before signing agreements with an independent switch provider.

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