MTN Group Ltd is seeking to challenge rival Vodacom Group Ltd as Africa’s biggest digital bank by tripling its customer numbers within three years.
Already the continent’s biggest mobile-phone company by subscribers, Johannesburg-based MTN is adding about 500,000 active banking customers a month, chief executive officer Rob Shuter, 50, said on Wednesday.
About 20 million people use MTN’s mobile banking now, he said in an interview at Bloomberg’s Johannesburg office.
MTN, Vodacom and other competitors are using more affordable and faster Internet to offer banking to people in countries where traditional financial services are scarce. Mobile-money accounts allow users to deposit and withdraw funds via their phones and pay for everything from groceries to haircuts.
“We really are at that early-adoption stage of mobile Internet” in Africa, said Shuter, who joined MTN from Vodacom parent Vodafone Group PLC in March.
In many of these markets, there is not sufficient fixed-line Internet that would be needed for mobile banking or even other banking options, he said.
Vodacom owns about 35 percent of Nairobi-based Safaricom Ltd, whose fast-growing M-Pesa banking service has made it Kenya’s biggest company. Together they have about 32 million banking customers in Africa.
CEO Shameel Joosub last week said that Vodacom was the “biggest bank in Africa,” having moved about US$100 billion through M-Pesa in the past year.
MTN has operations in 17 countries across Africa, ranging from its largest market of Nigeria to Guinea Bissau, the smallest. The company’s mobile-money growth is dependent on the company’s ability to invest in and develop the digital technology needed to harness the service, Shuter said. Even in the carrier’s more mature markets, digital services only contribute about 20 percent of revenue. MTN also sees its number of active data customers, at about 30 percent of the total, as a relatively low level that could be improved.
Further growth opportunities could come in the form of delivery of entertainment to mobile devices.
Spotify, the world’s largest online music service, has not entered Nigeria or South Africa partly because it does not carry any local content or have banking connections, Shuter said.
“In the right markets there is no reason why an MTN version of Spotify, where we collect the money from the pre-paid wallet or mobile-money account and we arrange the local content, can’t be successful,” said Shuter, who held executive roles at Vodafone in Europe before joining MTN.
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