![]() I see this more of an AML/CFT issue for the central bank who can’t identify the sender. Moreover, some mobile money providers also give commissions to the agent who registered a subscriber based on the subscriber’s activity (in this case a P2P transfer). The agent usually get a commission on registration, so unless he is very busy he should be happy to register a new customer. a sender with no KYC ID might choose another option to send his money). Therefore, even though direct deposit is a revenue loss, it can also be seen an increase of eMoney in the ecosystem which at one point will be charged (if prices and commission for all service are well designed) and an ease of transaction for the subscriber (e.g. Mobile money has gone from a Deposit-Transfer-Withdrawal scheme to a comprehensive eco-system with several different charged services to debit and credit you account. ![]() This is why we decided not to block it in Orange Money Uganda. In some countries like in Uganda, where the market is in an advanced phase, direct deposits have become a commun practice which subscribers and agents don’t consider as a fraud. It is true that direct deposit is an important factor to consider. Mobile money practitioners: Are there approaches to direct deposits not covered in this publication that you would recommend? Please do let us know at or by commenting on this post. Please follow this link to read the full publication. Preventing direct deposits: A framework for action This will be of interest mobile money practitioners and those involved in managing mobile money agent networks. In this MMU Spotlight publication, we discuss the root causes of direct deposits, the harm they create in mobile money programs, and steps operators can take to prevent them. The agent deposits the funds directly into the recipient’s account, allowing the sender to avoid the P2P transfer fee and process. A direct deposit occurs when the customer initiating a P2P transfer hands the agent cash, but provides them with the mobile number of the recipient rather than their own. One operator estimates up to 40% of P2P transfers take place through direct deposits rather than the intended means and, anecdotally, this figure is not unusual.įirst, what is a direct deposit? Direct deposits are the circumvention of the intended flow of a P2P transfer. Direct deposits have become an expensive nuisance for mobile wallet operators by eating into revenue, weakening customer engagement, and stunting registration efforts.
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