Pilot Survey on Mobile Money Service in Ethiopia

[Mesfin Fikre Woldmariam]

Dear gtug-addis members and other colleagues, I am a bit surprised
about why mobile money service is not yet started in Ethiopia. And am
interested together an opinion from friends like you and write a kind
of pilot survey. I would appreciate if you can spent 5 minute to
respond to the following.

The pilot survey result will be communicated to you with in two weeks time.

Irrespective of the reported success history of mobile money services
in most African countries, its huge revenue streams for the providers,
and access to financial service problem of the poor, mobile money
service is not deployed in many of the developing nations, including
Ethiopia.

Many literatures, related the issue with many stakeholders. So as a
researcher, I wanted to know your views and opinions regarding the
following questions.

1. What factors delayed the deployment of mobile money service in Ethiopia?
2. What are the challenges and opportunities that mobile money payment
stakeholders face (financial institutions, mobile network operators,
mobile money service providers, consumers, and regulators).
A. Financial institutions
B. Mobile network operators
C. Mobile Money service providers
D. Regulators
3. Do you think that M-PESA of Kenya can be successful if deployed in
Ethiopia? Why?
4. If mobile money service is deployed in Ethiopia, how do you think
that the normal service of the above stakeholders will be disrupted?
5. What incentives are there for these stakeholders?
6. If you have some ideas, what kind of business models could be
appropriate for Ethiopian market?
7. Any think you like to add, you are free to do so.


Regards



--
Mesfin Fikre Woldmariam



Addis Ababa University
IT PhD Program
Information Systems Truck
+251 911 15 51 30

Po.box 150132
Addis Ababa
Ethiopia

[Ayalew Shebeshi]

Selam Ato Mesifin,

 

I just read your email message.

in my understanding and short answer for you, Ethiopian's Ethio Telecom infrastructure is not enough to handling current sophisticated data transaction security system.

It might take a while to start Mobile Money Service in Ethiopia. I am not sure how Ethio Telecom current  infrastructure handle BYOD ( Bring Your Own Devices - it is hard to track smart devices - Mobile phones and tablets).

I am sure there is no any policy or guideline for  BYOD management and data access of organizations employs.

It is the most difficult technology ( Smart devices) to detect and protect individuals data transaction specially money & patient recodes.

It may be my view of this- as a software Engineer, quality control and quality assurance professional, Mobile Money Service in Ethiopia is a very sensitive issue to implement.

 

we can discusses this and other technology issue if u want to.

 

Kemakber selamta gar

 

Ayalew - down under from Kangaroo land

 

 

 

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[Mesfin Fikre Woldmariam]

Dear Ayalew,

Many thanks for the insightful ideas. I am really interested to
discuss on this and other IT issues. can we make it through Skype?

Regards

[Markos Lemma]

Hi Mesfin - 

It is great that you mentioned about Mobile Money. Here is my take:

1. What factors delayed the deployment of mobile money service in Ethiopia?

Regulation & policies.

strong bank objection (especially considering what happened in Kenya)

Ethio-telecom's readiness (mobile money 100% dependant on telecom services)

2. What are the challenges and opportunities that mobile money payment
stakeholders face (financial institutions, mobile network operators,
mobile money service providers, consumers, and regulators).
A. Financial institutions

B. Mobile network operators

Ethio-telecom current infrastructure doesn't support high level security services 

C. Mobile Money service providers

m-birr and Kifiya really want to go for this. But they are starup companies. Not like Safaricom. I talked to m-birr, even they are struggling to develop the API. There is a huge readiness , but the capacity is limited.

D. Regulators

I think regulators didn't permit MM so far. M-pesa show a lot of interest to operate in Ethiopia. When i was in Nairobi, i talked to m-pesa ,they said, they have been thinking of exploring ethiopian market from the beginning. Not a determined yes from ethiopian government yet.

3. Do you think that M-PESA of Kenya can be successful if deployed in
Ethiopia? Why?

YES, but i think, we should give the priority for Ethiopian based solutions. The telecom sector needs to be privatised before financial institutions. The Mobile Money falls into this category 

4. If mobile money service is deployed in Ethiopia, how do you think
that the normal service of the above stakeholders will be disrupted?

what is the normal service?

5. What incentives are there for these stakeholders?

No incentives, there is genuine business here. We are talking about un-banked citizens - both finical institutions, telecom providers, startups and big and small business profit out of it. in a real business term. we can discuss about this more in details if necessary. 

6. If you have some ideas, what kind of business models could be
appropriate for Ethiopian market?

M-pesa can be replicated 

7. Any think you like to add, you are free to do so.

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Markos Lemma
Tech Community Management  

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[Abinet]

I have few points to I want to make. I am basing my opinion based on my development experience on similar solutions, mypaga.com, and also because of the attempts we are still making to provide it in Ethiopia.

1 - Security - you can not relay on any service provider to do the security for you. It is all about your design and communication. There are standards you solution needs to meet in order to be acceptable internationally. And most of these standard checks look at your solution internally than externally.  The only issue I see with Ethio Telecom is the ability to host dedicated servers with no downtime.

2 - M-pesa - If you look at the business model that M-pesa has, it would not fit Ethiopia. M-pesa is big in Kenya for a reason. I don't see it replicated anywhere else in the world. The solution we should think of should be open to integration with many different types of organizations.

3 - Integration - If you want to implement such a solution, you will need to integrate with different entities. Most of our banks, service providers, and important institutions will need to build their solution and expose it initially. eg. if you want to be able to top-up airtime, you will need to integrate with Ethio-Telecom services. I don't know if such a thing exists at the moment.

4 - Technically/Financially sound - If you see how other payment platforms are designed, eg paypal, you will immediately realize the amount of energy and time it takes to build it. There is a lot of investment going into building a world class solution. So there needs to be capital ready to do this. i.e. Financially capable of running the business for months without profit, marketing to penetrate through Ethiopian mindset, Engineering setup and running costs and much more. So I am not sure if there are Angle investors but you will definitely need them. 

5 - Banks - Banks play a great role when it comes to financial solutions. Not only are they policy makers but are also active players in this. I see a lack of technical capability in most banks. This is not to say the don't know what they are doing but rather to say that they don't have the capacity, at least at the moment, to cater such needs.

Abinet Zelalem

(+251 915 995 555)

[Yonas Alemayehu]

Hi All 

this is becoming a very nice discussion. I do agree with Markos's points.

Hi Abinet, with respect to security I don't think you see it in a broader way. security is a very big issue and should not be left only to the developer or design team of an application though that is one part where security has to be addressed. hacking is becoming so complected those days and billions of USD is lost every year. apart from securing your application from design and development perspective, the hosting company or the ISP infrastructure security also matters a lot. with this respect I don't think Ethio telecom network is as such secured or proved with penetration testing etc. similarly most of the banks are currently using VPN networks, but when payment or financial services which we are talking about comes into play and exposed to the www security will be a huge issue and has to be addressed.

other points which I would like to add is, as it is explained before some companies has already started mobile money like m-birr but it is becoming very taugh even for them for so many reasons. I think before we jumb to the solutions of providing such services it would be better if the gov could adress and desiminate clear standardized regulation or policy on how to make business using such solutions. besides releable, stable and high speed internet connection infrastructure has to be in place and for this either additional ISP has to come or ethio telecom has to be privatized.

[Abinet]

Great to see such interest and discussion.

Looking at what has been done so far, looks like there is a need to implement new networks to support financial solutions, i.e from ethio-telecom point of view. Some go with private bank networks, some go with redundant networks just for such institutions both for efficiency and backup.

@Yonas,The dev in me wants to respond to the security discussion. When designing any solution, you don't rely on the security of collaborating systems. And when it comes to financial solutions, you particularly don't trust anybody but your own solution(even that is not true if you want to look deeper); your ISP can only guarantee you uptime and not your security, maybe the SLA can have a physical security threat guarantee, but nothing more than that. I understand there is no such thing as a fully secure solution, but rather a solution that is as secure as possible. Yes the security on the communication end is important, but when or if this is compromised your solution should be able to mitigate and minimize the security risks. 

This is starting to sound like a topic for another thread, if you feel the need to go deeper and discuss the technical bit of this, lets do so, i would love to hear your thought on it.

best

[Lee Grant]

Hi Guys,

We have been trying to get in contact with Ethio Telecom to provide a platform that we launch within 6 weeks it can run within there infrastructure or parallel

It's been impossible to get a hold of them and we have even tried via the UK Embassy in London since June 2014

Awaiting your speedy reply

 

Lee Gibson Grant

Skype: le-grande1

Mobile UK: +44 (0) 7913345961

Mobile Ukraine: +38 0938671229 "Currently Available on this number"

USA TEL: (+1) 703 291 8076 "Currently Available on this number"

Email: l...@coinstructors.com

[Abinet]

Not sure if this is the right topic nor forum to discuss this. In any case, it sounds like you have never done any work with Ethio Telecom before nor understand the regulations to run such services. The easiest way to get in touch will be through one of the associations that work closely with them, try www.ictet.org for starters, or get a number to their corporate office.

best of luck.

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[Markos Lemma]

go to their office & talk to them 

Markos Lemma about.me/markoslemma

+

+251-91-261-5214

Skype: Jobbaciy 

[Markos Lemma]

Considering the tread on Mobile Money Service ? 

What are the current updates?

[SOLITCON SOLITCON]

I have the utmost respect for all of you folks trying to provide e-solutions in the world under Ethio Telecom. In 2004 I came back to Ethiopia from the West (after 20 years) with grandiose visions of providing technology education and solutions. After three years I gave up and came back to US. But to see that things have not changed much with Telecom is discouraging but I am encouraged to see others still slugging it out there

I admire you all!!