Malawi’s central bank blames pandemic for drop in Fintech use
The Reserve bank of Malawi has blamed COVID-19 and economic slowdown for a drop in the volume of electronic transactions in Q1 2021.
According to the Bank’s National Payment System report for Q1 2021, the volume of all electronic payment streams dropped 3.7%, from 151.3 million to 145.7 million.
Despite a 13.6% increase in the number of registered subscribers for mobile money services to 8.6 million at the end of March 2021, the corresponding value of transactions decreased to MK13.8 trillion from MK17.7 trillion in Q4 2020.
During the same period, digital financial services transactions was impacted with a reduction in both the volume and value of the transactions by 3.7% (144 million) and 8.5% ( MK1.9-trillion) respectively compared to the preceding quarter.
In response to COVID-19 and in an effort to promote more widespread use of Fintech among consumers, the Bank announced engaged with MNOs to reduce fees for services.
Airtel mobile money and Telekom Network Malawi (TNM)’s Mpamba transaction fees were removed.
An excerpt from the Report reads: “But effective 1 August 2020, fees on all person-to-person transactions for mobile money transactions within the same network and other networks reverted to their original transaction fees following the expiry of the three months moratorium.”
Chairperson of the Private Sector Taskforce on COVID-19 Vizenge Kumwenda said businesses yearn for more affordable mobile phone services.
Kumwenda is quoted by the local Nation newspaper as saying: “We appreciate the effort by the mobile phone operators to have considered us previously with a reduction in mobile money services but this is needed most now when there are many digital activities happening.”