Anticompetitive practices in the Mobile Money Niche raises Fierce competition

The mobile money market in Cameroon is certainly expanding, but remains at the embryonic stage compared to African countries such as Uganda and Kenya. The two leaders (MTN and Orange) in the mobile market in Cameroon have been fighting a real battle to position themselves on this digital telecoms market sector.

On 6 December 2016, Orange Cameroun officially launched its Visa Orange Money card. This payment tool described as “revolutionary” by its sponsors, now enables subscribers of the Cameroonian subsidiary of the Orange group to withdraw money from their Orange Money accounts, from ATMs in the Visa network spread through the country.

In a tit for tat response, MTN Cameroon, the competitor, just launched a money transfer service to 25 countries on the African continent. “No more extended queues and long hours in transport. With MTN Mobile Money, you can now send money to 25 countries in Africa from your MTN Mobile Money account”, announced the Cameroonian subsidiary of the South African telecoms group MTN International.

In this commercial war on mobile money, the two operators also started looking for partnerships with banking institutions, to offer their mobile bank clients the possibility of making transactions from banking accounts to mobile accounts, and vice versa. This is how in 2015, Orange Cameroun entered into partnership with Ecobank, while MTN and Afriland First Bank launched the Mobile Account Connected (MAC). We learned from good sources that Orange also connected to this service a few weeks ago, thus becoming the first operator to benefit from two banking networks allowing it to connect its mobile accounts to bank accounts.

In the streets throughout the country, this mobile money competition is even stiffer: MTN and Orange made the sale of the product accessible to everyone. It is not necessary anymore to be a preferred partner to offer mobile money services. The logo signalling the availability of the product is now even visible under the umbrellas of the call-boxes operators. Concurrently, a growing number of filling stations have also become points of sale for mobile money service.

This coverage of the country is such that Orange Cameroun is now claiming 3,600 points of sale throughout the country. A network which keeps on growing, and through which no less than FCfa 12 billion have be transacted since 2011. Contrary to the initial projections of only FCfa 2 billion, reveals Stéphane Huret, Central Director at BICEC, the banking partner of the Orange Money service.

As it happens, if they are satisfied with the numerous advantages already provided by mobile money services in terms of bill payment, money transfer, online purchase, etc., the Cameroonian consumers are not yet treated in the same manner as consumers in Western and Eastern Africa. In some countries in the regions of Africa, deposits on mobile accounts are not only remunerated, but also enable consumers to access loans.

Source: K'mer SAGA