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Mobile Money and SMS services
How much does it truly cost?
This is the second piece in a series of articles by PaygOps -and guest contributors- on TelCo.
Introduction
Across emerging markets, millions of people living in rural areas are still lacking access to essential services i.e. lightning, drinking water or healthcare as they live miles away from the nearest city. Indeed, they suffer from poor infrastructure (often lacking tarmac road or electricity access for instance) and thus collecting payments in cash for a service is also a struggle that contributes to their isolation from a range of offerings such as prepaid energy or prepaid water services that are only available in cities; or from other types of offers such as essential products sold in a leasing model (solar home systems, water pumps, other solar appliances, among others...). Last-mile distributors serving these isolated communities face two challenges to be able to scale up their impact.
The first one is related to the collection of payments: how can they collect the payments from underbanked people without having to regularly send agents to each individual household of the hundreds or thousands of clients they have? Mobile Money (MoMo) has been a cornerstone of last-mile distributors’ strategy to reach households in hard-to-reach areas and therefore enabling them to scale their operations faster.