It does look like government has finally taken a decision to have a single platform, otherwise known as national switch to interoperate mobile money payments and other transfers from before the year ends, if latest timelines by Vice President, Dr Mahamoud Bawumia is complied with.
“I have, on behalf of Government, today challenged the key stakeholders, to ensure there is interoperability between Ghana Link, which the banks are on, the e-zwich platform, and the mobile telephone platforms within six months. I am confident this can be achieved”,
Interoperability refers to the ability of a subscriber to send money from one network to the other.
Speaking at the Ghana Economic Outlook and Business Strategy Conference on Wednesday, the Vice President explained that as compared to many other countries, Ghana has a well-structured financial services sector; a trusted regulator, an efficient banking system and a robust telecommunication facilities.
He said what was left was for all the players to be brought together and co-ordinated by a single entity to ensure the maximization of the benefits offered by mobile money and other electronic payment services.
According to him, “the process itself is not rocket science. Government would like to see the realisation of the interoperability in mobile money transactions across telecom networks by the end of 2017”.
The comments by the Vice President is expected to end a back-and-forth process initiated by the Bank of Ghana two years ago to hire a private firm to set up a national switch at the company’s own cost and operate it over a 15-year period.
“I think it would be very nice if we all put our minds to it and I think you guys should be talking a bit more for us to get it done. I want to encourage banks and mobile network operators to collaborate to increase the range of services available to customers,” he said.
Already, the central bank has engaged Sibton Switch Systems who have been working on a process to rollout interoperability operation in the country. In terms of benefits, the interoperability offers wide range benefits to consumers, the operators and government. For instance, the successful rollout of the interoperability concept will enable the Ghana Interbank Payment and Settlement Systems (GhIPPS) to improve on its operational capacity and scope
of work while leveraging on its existing networks. Even though the very concept of mobile money or electronic payment transactions creates convenience for the patrons or users, the idea to make the system interoperable ensures that the consumer gets an added benefit of efficiency. Because there is a third party, kind of monitoring services provided and other transactions, the telecommunication and banking firms are compelled to be more productive, sharpen their competencies and that of their agents and overall attain proficiency in their deliveries. The little complaints are eliminated or drastically reduced.
The second point crucial to the consumer benefit argument has to do with safety. Even though the telecommunication companies in Ghana have done pretty well over the years, one cannot ignore security issues resulting in common allegations of hacking, stolen passwords and missing funds, poor network among others. The presence of a third party providing inter-network operability will ensure there is greater degree or an improved reliability within the entire platform. Additionally, the sophisticated nature of the switch to be provided by Sibton Switch will guarantee a highly robust system with its attendant system integrity. That way, the consumer is assured of a hitch-free service any time of day, anytime of the year.
Yet another benefit to the consumer exist in the countries making up the West Africa Economic Monetary Union (WAEMU) and countries like Congo DR, Kenya, Liberia, Nigeria, Madagascar, Rwanda, Tanzania and Uganda. In these countries, the consumer can transfer funds from an E-money and/or deposit account to another account using a mobile device. He or she is able to do transfers including transferring e-money to other e-money, e-money to bank accounts or bank accounts to E-money, bank account to another bank account and all that is possible due to the presence of a third party to carryout an interoperability switch, according to the Alliance for Financial Inclusion (AFI). So whereas under the current status quo, transactions are allowed only among users of same network, consumers will be in a position to send money irrespective of the recipient’s telecommunication network. This is also because instead of the current arrangement of peer-to-peer switching, a central or one common national switch would have assumed control of the interconnecting all the operators.
In February this year, a well known Blogger, Chris Skinner reported that three leading MNOs – Vodacom, Millicom’s Tigo and Airtel – announced full interoperability. Vodacom’s participation means that over 16 million mobile money users in Tanzania will be able to send payments to each other, regardless of which mobile operator they use. That is a key achievement, with the country claiming to be the first in Africa with full interoperability.
Lets come to employment generation. Allowing a private company to undertake this task of interoperability alone means that the state or the government through the central bank will be seeking to deepen its collaboration with the private sector. The private company will be required to employ a certain appreciable number of people as staff. They will be made of highly technical professionals to helping hands. The company will need additional numbers to man its numerous Call Centers to be set up nationwide. Through their work, the Switch operator is able to include more users onto the platforms, which may mean that a lot more agents could be engaged in the chain. In the end, significant jobs are created out of this project alone.
Perhaps the better part of this consumer benefit argument also is the fact that consumers get to pay less under the interoperability arrangement. This is due to the way things occur in the central switch system; the more people (consumers, banks and telecommunication firms) are added, the less the consumer pays because the cost is then spread among all users. It is therefore not true that with the coming into being of the interoperability concept, consumers will pay more. May be a a simple demonstration will suffice. So for instance, instead of paying ghc 20 for sending GHC 2,000 as it is currently, the figure will reduce to GHC 17.5; GHC 7.5 for GHC 1,000 instead of GHC 10; GHC 3.50 for GHC 500 instead of GHC 5; GHC 1.75 for GHC 200 instead of GHC 2.00 and GHC 0.75 for GHC 100 instead of GHC 1.00. this is how one stands to gain when the interoperability becomes operational.