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SMS Exchange: Mobile credits as an electronic payment channel. Case of RWANDA

ITU Workshop on “ICT Innovations for Developing Countries” (Tunis, Tunisia, 20 June 2012). SMS Exchange: Mobile credits as an electronic payment channel. Case of RWANDA. Jean Pierre NSHIMIYIMANA Rwanda Utilities Regulatory Agency & Independent Researcher piero425@gmail.com. OUTLINE .

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SMS Exchange: Mobile credits as an electronic payment channel. Case of RWANDA

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  1. ITU Workshop on “ICT Innovations for Developing Countries”(Tunis, Tunisia, 20 June 2012) SMS Exchange: Mobile credits as an electronic payment channel. Case of RWANDA Jean Pierre NSHIMIYIMANA Rwanda Utilities Regulatory Agency & Independent Researcher piero425@gmail.com

  2. OUTLINE Overview on Rwanda Mobile Transaction status and Statistics Challenges for these systems SMS Exchange System Conclusion and Recommendations

  3. RWANDA

  4. Photo: Internet

  5. Mobile Transaction Systems Status 1.Mobile Banking (for Banks) Eg. To buy electricity • Prerequisites: • To be a Bank customer • To be registered for this system • To have deposit • The money is deducted from user’s bank account directly.

  6. Mobile Banking (Cont.)Statistics

  7. Mobile Transaction Systems Status (Cont.) 2. Mobile Money (for Telecom) • Prerequisites: • To be a Telecom customer • To be registered and to have a mobile money account • To have deposit • The money is deducted from user’s Mobile Money account directly.

  8. Mobile Money (Cont.)Statistics

  9. These systems are veryFLEXIBLE & AVAILABLEand technically working well, But… ?

  10. CHALLENGES 1. Low Revenue • The GDP is 502 USD per year • The little revenue becomes “First Aid”! • There is no need to go for deposit because tomorrow it shall be needed! • The effort to go for deposit = the effort to buy this utility!

  11. CHALLENGE (Cont.) 2.Geography

  12. Because people are scattered in the village far from the cities, it becomes difficulty and costly to make a registration and deposit (as prerequisites for these systems). (For Many) The use of these systems cannot justify the cost to be done

  13. With this situation, the purchasing of some services becomes more DIFFICULTand involves a lot of THIRD PARTY COST like transport and time consuming (especially in remote areas).

  14. SMS EXCHANGE!! • Introduction • Status • Functionality • Comparison • Advantageous • Challenges

  15. INTRODUCTION • Through a question asked in ICT Forum in Kigali last year, How can people in the village can have access to the Mobile systems, A commitment came to make a research for a solution, hence the SMS Exchange System. • As these people are having cash, the key prayer was to find an exchange object, which should so popular to that be accessed by every mobile user.

  16. INTRODUCTION (CONT.) • That exchange point is mobile Credits: • the mobile penetration is 42% (4,508,666) of the whole population, ie each household has almost two mobile phones. • This penetration also has a great impact of Credits availability (almost at each door)

  17. SMS EXCHANGE STATUS The system is in the process of being patented It also being implemented in one of Mobile Operators in Rwanda (MTN Rwanda)

  18. FUNCTIONALITY The system is a USSD Application and Value- Added Service (VAS) to Mobile Network; It is connected directly to the Intelligence Network (Billing system); It uses the credits a mobile user has in his phone to buy/pay some services.

  19. FUNCTIONALITY (Cont.)USE CASE DIAGRAM

  20. FUNCTIONALITY (Cont.) DATA FLOW DIAGRAM

  21. COMPARISON

  22. COMPARISON (CONT.)

  23. ADVANTAGEOUS

  24. CHALLENGES • The system requires many interconnections of different players' System (Operators, Utility Providers), • It requires also an important budget (for financial reconciliation at a period) • It has not been easy to convince: • It’s new (always this question: Show where else it has been implemented??) • A big WORRY: It is touching the “HEART” (billing system).

  25. CONCLUSIONS & RECOMMENDATIONS • To Telecom (especially in developing country): • To promote such systems as they can help a lot of people (especially in remote areas) • To Government & ICT Regulators: • To promote the spirit of research so that many innovations should come up and ICT continue to go beyond core communication (Voice, SMS and Internet) but also impact the whole life even to people in the heart of villages

  26. CONCLUSIONS & RECOMMENDATIONS (Cont.) To ITU: to continue such workshops to help an innovation in one place to spread an to every one as the globe has become one home.

  27. Merci! Thank You!

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