MTC brings competition to electronic money business


MTC Namibia’s entry into the electronic money market will have a positive overall impact, Simonis Storm Securities, equity analyst, Shaun Lahner told Observer Money this week.

MTC announced in interim results for the six months ended 31 March that as part of our long-term growth strategy, MTC is actively pursuing a CSP to DSP (Communications Service Provider to Digital Service Provider) transformation.

“This shift will enable us to adapt to the evolving digital landscape and meet the changing needs of our customers. Our intent is to enhance our portfolio of digital services and leverage emerging technologies to provide a seamless and personalized experience to our valued customers,” MTC said.

MTC said it was dedicated to expanding its Mobile Financial Services (MFS) offerings and has ambitious plans to launch MFS in the coming quarters, aiming to empower our customers with convenient and secure financial solutions.

MTC said the Bank of Namibia has resolved to grant Windhoek General Administrators (Pty) Ltd, a wholly owned subsidiary of MTC, provisional authorisation to issue electronic money in Namibia in terms of the Determination on Issuing of Electronic Money in Namibia.

Lahner said by targeting the ‘non-banking’ sector and leveraging their extensive coverage, MTC can offer these value-added services at a more competitive price.

“Traditional banks are unlikely to aggressively compete in this sector as it may not have been historically seen as worth the effort due to the limited customer base in remote locations. Apart from the enhanced convenience and inclusivity, we anticipate collaborations and partnerships between different players in the market. However, with MTC securing the green light from BoN, we can’t help but wonder when their focus might shift to the lucrative banking sector. Fintech poses a serious threat to traditional banks due to its rapid pace and ease of entry,” said Lahner.

The current product announced by MTC appears to be their own mobile payment solution, indicating a potential shift from their previous partnership, Lahner said.

“This transition allows MTC to have more control over their services and potentially introduce new features.”


Lahner said it was difficult to say definitively whether MTC will choose to go it alone or partner with a financial institution in the electronic money business.

“Both options have their advantages and considerations. Going alone provides MTC with more control and flexibility, while partnering with a financial institution can offer established infrastructure and regulatory expertise. Ultimately, MTC’s decision will depend on various factors and strategic considerations.”

Lahner said although the market is already crowded with established players, MTC’s entry could introduce competition and potentially disrupt the status quo.

“The success of MTC’s penetration into the banked market will depend on factors such as the attractiveness of their offerings, value proposition, customer experience, and their ability to differentiate themselves from existing players. It remains to be seen how MTC positions themselves and whether they can effectively capture a share of the banked market.”

Talking about how operators in Southern Africa have dealt with mobile money, Lahner said operators in the region have employed various strategies to navigate the business of electronic money. These include forming partnerships with financial institutions, developing mobile money platforms, establishing agent networks, integrating services, ensuring regulatory compliance, and investing in marketing and customer education.

“These approaches aim to provide convenient and secure financial services while expanding their customer base and promoting financial inclusion.”

He said MTC has the potential to reach a wide customer base, including the unbanked population.

“The entry of a well-established mobile telecommunications company like MTC into the electronic money market can bring competition, innovation, and increased convenience for customers. It will be interesting to see how MTC positions itself, collaborates with financial institutions, and differentiates its offerings to capture a share of the market. The success of MTC’s rollout will depend on factors such as customer adoption, regulatory compliance, and the ability to provide secure and user-friendly electronic money services,” he concluded.

MTC already operate, MTC Money, a mobile payment solution that allows customers to use your cellphone to transfer, withdraw, deposit money, buy airtime and electricity, pay bills and make Point of Sale (POS) payments.

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