MTN and Ericsson team up to enhance mobile financial services across Africa

MTN and Ericsson have solidified their partnership, extending it for another decade with a focus on enhancing mobile financial services in Africa. This comes five years after the launch of MTN’s mobile money wallet. Using MTN’s Mobile Money (MoMo) service facilitated by the Ericsson Wallet Platform, the alliance aims to promote financial inclusion by catering to a range of customers, from first-time users to sophisticated business applications.

Michael Wallis-Brown, the Head of Mobile Financial Services at Ericsson, explains that this partnership will allow people without traditional bank accounts to manage their finances for the first time. It will also aid in bridging the gender gap by providing women with access to financial services, fostering digital inclusion, and offering advanced users access to more complex services.

The collaboration between the companies began in 2014, when Ericsson was entrusted with managing, optimising, and maintaining MTN Nigeria’s network infrastructure in Lagos, Abuja, Enugu, Port Harcourt, and Asaba. In 2019, the partnership was extended for five years to provide Managed Services for Mobile Money and introduce new products and services in 13 countries across the Middle East and Africa.

This collaboration led to the launch of the Ericsson Wallet Platform throughout MTN’s African operations. The platform provides secure money storage, transfer, and withdrawal services. Additionally, it processes payments from merchants and utility providers and offers financial services such as savings and loans.

As of the third quarter of 2023, MTN MoMo’s mobile money service boasted 61.7 million active users, who used the platform for various money transfers. This shows a significant increase of approximately three million users compared to the previous quarter.

In terms of transaction value, MTN MoMo has seen impressive growth, nearly tripling its annual transaction value from $76 billion in 2018 to $204 billion in 2022. Moreover, the number of transactions also experienced a substantial increment, going from 3.5 billion in 2018 to 12.7 billion in 2022, marking a nearly 300% increase.

On the other hand, the Ericsson Wallet Platform plays a crucial role in supporting over 400 million registered mobile wallets globally. It processes over 2.8 billion transactions each month, amounting to over $40 billion, through financial institutions and communication service providers.

Aligning with its expansion goals, MTN’s fintech division MoMo, valued at $5.2 billion, struck a deal with Mastercard in August 2023 for the latter to acquire a 30% stake. Ralph Mupita, the Group’s CEO, revealed that this partnership could potentially involve three to four collaborators.

In August 2023, MoMo Payment Service Bank (PSB) forged a partnership with Saana Capital, an internationally licensed cross-border company. This collaboration was aimed at facilitating bill payment services as well as smooth inbound and outbound transfers across Africa.