MTN Expands Fintech Services in South Africa

South African mobile operator MTN is pushing further into the country’s growing fintech industry with the launch of new services that will enable users to send cash overseas and businesses to receive payments via an app.

Mobile operators are increasingly venturing into financial services across Africa, a move driven by the lack of access to traditional banking services for a significant portion of the continent’s population. MTN South Africa reports approximately 9 million registered mobile money subscribers, with the company’s primary focus being the 15% of South Africans who remain unbanked.

International Remittances and Business Payments

Bradwin Roper, MTN South Africa’s Chief Financial Services Officer, announced that South Africa-based mobile money users will now be able to send money to recipients in over 10 African countries in real time, provided they are also registered MTN service users.

In addition, MTN has launched a virtual wallet for business owners, allowing them to receive payments via the app or QR code. This service is expected to reduce the cash handling of South Africa’s “spaza” shops, informal stores prevalent in townships.

Enhancing Payment and Insurance Services

To further simplify transactions for business owners, MTN has introduced point-of-sale devices that are cheaper to rent and combine payments and other services like airtime purchases into a single device.

Spaza shops, frequented daily by about 80% of South Africa’s population, represent an industry valued at approximately 178 billion rand ($9 billion).

Alongside these payment services, MTN has also introduced funeral insurance. This new offering allows customers to take out cover for either six months or 12 months with a single payment, as opposed to traditional monthly debit orders.

MTN re-entered the South African mobile money market in early 2020, after a hiatus of over three years. This current expansion of services signals the company’s commitment to addressing the financial needs of the country’s unbanked population and enhancing the payment solutions for small business owners.