Namibia: MTC Money Has No Banking Licence

MARCH 03,2014.

THE NAMIBIAN.

THE recently launched electronic payment, MTC Money, a joint venture between MTC and MobiPay, is operating without a banking licence.

"Neither MobiPay nor MTC have a banking licence in the technical sense. MobiPay, however, has a Mobile Payment Issuer licence issued by the Bank of Namibia. This is the licence being used by MTC Money," MTC spokesman Tim Ekandjo said in response to questions from The Namibian.

MTC Money has raised a stink in the Namibian financial circles as some players feel a product like MTC Money must be operated by a financial institution.

Bank of Namibia spokesperson, Ndangi Katoma did not respond to questions seeking clarity on the issue.

Ekandjo said MTC Money "is a mobile service convenient and enabling customers to pay their mobile accounts, electricity accounts, DSTV accounts, buy and transfer airtime, pay for services at retail stores and importantly send money to relatives and friends through mobile phones without being required to have a bank account".

He said if MobiPay did not have a Mobile Payment Issuer Licence, the Bank of Namibia would never have allowed MTC Money to operate.

"So these reports are definitely not just wrong but also unfortunate," he said on the two non-banking institutions, operating such a financial service.

During the launch of the product on 12 February, Barbara Gowaseb, director of payment and settlement systems at the Bank of Namibia said one of the key strategies in the National Payment System Vision 2015 is to promote wider access to payment system services by allowing non-bank players access to provide innovative services such as mobile money in Namibia.

She said the central bank as the custodian of the integrity of the financial system, takes a strong interest in these developments in consumer payments.

MobiPay has been around since 2009 when they first lodged an application with the Bank of Namibia and was given authorisation to provide mobile payment services in 2010, under the provisions of the Payment Systems Management Act.

In 2012, the central bank to ensure efficiency, safety, and accessibility of the national payments system, gazetted the Determination on the Issuing of Electronic-money, also known as E-money, in Namibia in 2012.

MobiPay was then identified as an authorised issuer of E-money.

"This piece of regulation paved the way for MobiPay and any other interested parties to provide innovative payment services through E-money that could potentially reach the financially excluded," said Gowaseb.

She said the central bank hopes the continued promotion of E-money services in Namibia will encourage competition in payment services and make them more accessible and cost effective for all Namibians.