The future of commercial banks is gradually slipping into the hands of telecommunication companies, and this doesn’t bode well for the Nigerian lenders, as the inroad into mobile money market by network providers is likely to make banks redundant soon.

Before the entrance of the GSM firms in Nigeria’s telecommunication industry in 2001, having a mobile phone and getting across to people within seconds, no matter how far they were, was something akin to a miracle. They had made the seemingly impossible to become easy. But no matter how much of a feat it had accomplished, no one expected it to grow into an industry capable of making financial payments. Drawing a correlation between network providers and bank functions was far-fetched, but fast track to 2019, and they are now officially recognized as operators of payment service bank (PSB).

Mobile money is the payment of services or financial transaction between a buyer and merchant through mobile phone. The payment system is also called mobile payment and mobile wallet. Individuals can buy goods and pay for services through the use of USSD code or mobile app.

The quest to bring banking closer to the under-served for financial inclusion has accelerated the value of telecoms firms. The idea of allowing telcos to operate as mobile money service providers had been frowned at in the past, but all that is changing, as Central Bank of Nigeria (CBN) has come to realize that achieving its 80% financial inclusion is impossible without the likes of MTN Nigeria, Airtel, Glo and other telecoms firms.

The likes of Ifie Sekibo, Managing Director and CEO of Heritage Bank, Nnamdi Okonkwo, MD/CEO, Fidelity Bank, and some others have all stated that the presence of telecoms in the mobile money service brews no fear.

Such is expected, as market rivals are known to never speak of themselves as inferior to competitors; but if statistics are anything to go by and with comparison to other market in Africa where mobile money is thriving, banks are gradually heading towards that “inferior” direction if the threat posed by telcos is not handled properly.

Numbers are against banks

It would be unwise to bet against telecoms firms in the mobile money market, considering the position they hold and number of... https://nairametrics.com/2019/08/21/mobile-money-war-telecoms-threaten-banks-future-in-nigeria/