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MOBILE BANKING : Cameroon’s Immersion in the Financial Service

The breakthrough of mobile and financial services offered by telecommunications operators and fintechs requires banks to adapt, at the risk of losing ground in a country that already has one of the lowest rates of banking.

In a report published by the Ministry of Finance, Cameroon’s the banking rate reached 28.3 % (including microfinance) in 2020. The report shows that more than 70 % of the country’s population does not have access to banking services, meanwhile most of this segment of the population has a mobile phone, and can therefore have access to financial services via mobile operators.

With the advent of mobile telephony, the penetration rate is close to 90 % in Cameroon. This according to officials, has facilitated transactions as people no longer need to have an account in banks to be able to make deposits, withdrawals, money transfers and other merchant payments.

Unlike the rather restrictive banking procedures, the offer of telcos and other fintechs is so flexible that over the past decade, MTN Mobile Money and Orange Money services have literally exploded in Cameroon. To the point where, according to the report of the Bank of Central African States (Beac) on “electronic money payment services in Cemac in 2020”, Cameroon has 64.8 % of the 30.1 million Mobile Money accounts identified in the Cemac area, and claims 73.1 % of the 14 822 billion FCFA of transactions made via mobile accounts in economy community in 2020.

Forced to share these revenues with mobile operators, almost all banks have developed mobile applications to allow customers to make transactions remotely, with the same flexibility as Mobile Money in order to take greater advantage of the opportunities offered by mobile telephony.

Beac in its 2020 report on electronic money payments in the Cemac, « until the end of 2018, the activity of issuing and managing electronic money could only be carried out through partnerships between commercial banks and mobile phone operators. But, since January 1, 2019, the regulations allow the emergence of new autonomous actors of banks, which will be classified in the category of payment institution ».

Mobile operators Orange and MTN Cameroon have already entered this breach, obtaining approvals respectively for Orange Money SA, in 2022, and Mobile Money Corporation (MMC), in 2023. According to the regulation on payment services in the Cemac, adopted on December 21, 2018 by the ministerial committee of the Central African Monetary Union (Umac), these structures, apart from managing the operations of deposits, transfers and withdrawals of money, can grant credits to their customers like banks, though limited at 100 000 FCFA for the moment.

Sorelle Ninguem

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