Mobile Money Service provider, MTN Ghana says a centralised national identification system is crucial in addressing the challenge of nonpayment of loans collected by some of its customers.
According to the company, some unscrupulous persons register more than one SIM card to take advantage of MTN’s momo service without paying their loans.
Speaking at the MoMo Stakeholder workshop, General Manager of MTN’s Mobile Money Limited, Eli Hini, says this threatens the sustainability of their operations and can only be addressed with a unified identification system that would prevent individuals from having various ID cards.
“The whole idea is to provide access to funds when you need it and if you do not pay back it also affects the next loan to another person. On our side part of the intervention is to try and zero down further to the customer identification and that is where we believe that once we can get to that point where the customer is known as is without all the multiplier ID platforms that we have, we would be able to further enhance the efficiency of the system”, he said.
On his part, Head of Fintech and Innovations at the Bank of Ghana, Kwame Oppong said efforts are being made to nib the issue in the bud.
“It is important for us as a regulator, service providers and all third parties in between from donors to NGO to provide the education for consumers to understand the services that they are using because often as much as we are trying to address the issues of financial inclusion you could have a secondary situation where a consumer of a financial service could wind up abusing the opportunity and access a financial service to destroy their own ability to access credit later.
So I think already the digital lending that is occurring is feeding into some credit bureaus and that is why I sounded that caution because today if you borrow and you do not pay back you will see the consequence of it when you go to another lender to seek a loan. So its already happening,” he explained.
Mobile money penetration in the country is growing rapidly as the economy is seeing increasing growth in terms of agents and customers, since its introduction in 2008 by telecom giant MTN.
The total value of Mobile money transactions in Ghana continues to rise as it increased from GH₵23.4 billion recorded in March 2019 to GH₵33.8 within the same period in 2020. This indicates a more than 30 percent increase.
Another service being rendered on the mobile money platform is the giving of soft loans to customers. But the introduction of this facility hasn’t being without challenges as Telco’s like MTN grabble with the challenge of non-payment of loans by debtors.
