MTN Group has big ambitions for its mobile money business and is presently considering publicly listing that side of the business in an initial public offering (IPO). While there’s no timeline yet for an IPO, MTN Group is valuing its mobile money business at $5 billion. 

It comes weeks after Airtel sold stakes in its standalone mobile money business to the TPG Group as well as Mastercard for a combined $300 million. That 11% stake will help Airtel deepen its offering across the 14 markets in which it operates. 

MTN is basing its valuation on Airtel’s. The company’s CEO, Ralph Mupita said, “with similar valuations to that of Airtel, our valuation would sit at 75 billion rand, or about $5 billion. No decision has been made as yet, but listing will be an option considered if that will be the best approach to unlock value.”

MTN Mobile Money (MoMo) has seen rapid growth across the 16 markets in which it operates. By the end of September 2020, nearly 42 million people were regularly transacting on MoMo, an increase of 4 million people from the first half of 2020. 

There is room for even more growth with the GSMA report for 2020 showing that of the 1.2 billion mobile money accounts globally, 548 million of those are in Sub Saharan Africa. There’s especially room for growth in Nigeria where financial services, although powered by banks, are still somewhat dominated by the big banks. 

With 60% of Nigeria’s 114 million adults unbanked, telcos have a natural advantage over banks in trying to reach the unbanked. The telcos use a simple model where users don’t need to install any apps or worry about any complex bank-like registrations. 

This USSD-led mobile money approach has been popular for years but all the signs are there that mobile banking is growing more complex. This is mostly because, while USSD is pretty easy to use, it has really poor security.

It is presumably why mobile networks are planning towards a mobile banking future that will be more sophisticated than allowing users to simply send and receive money. Wiza Jalakasi, a technology and financial services analyst, gives some brilliant insight into this in an article from 2019. 

In the end, it might feel like early days, but with telcos showing their hands and declaring their intentions, we may be poised for more growth of mobile money in the near future. 

Read this next

Last week, Ampersand, Africa’s first electric motorcycle company, secured a $3.5 million investment from the Ecosystem Integrity Fund (EIF). This is the largest ever e-mobility investment by a venture capital fund in Sub-Saharan Africa and could hint at a turning point in African electric transport. Based in Kigali, Rwanda, Ampersand assembles and finances electric motorcycles […]

More From TC

One landmark acquisition, several funding rounds and meaningful expansions have drawn attention to Nigeria’s potential to become an enabling environment for businesses. Nigerian tech startups are raising larger seed rounds and pursuing unique global ambitions than at any other time in the last decade. But in the last 18 months, major regulatory events that ended […]

According to a World Health Organisation (WHO) study, if a person inhales smoke while cooking breakfast, lunch and dinner, it is equivalent to smoking between three and 20 packets of cigarettes a day. Over half of the world’s population still cooks over open fires. In Nigeria, it’s worse as only 10 million have access to […]

My Life In Tech is telling the stories of Africans making a difference in the world of tech. At the end of our conversation, I learned two things about the man. He wants more people to have access to financial services regardless of what form of financing they currently have.  And he really loves to […]

TechCabal is a Big Cabal Media brand

Copyright © 2013 - 2021
All rights reserved

Privacy & Terms