Mobile financial services promising in Myanmar

A BOOM in mobile financial services (MFS) is anticipated, thanks to the rapid increase in penetration rate and poor infrastructure in Myanmar, according to Takashi Shigeno, director of KDDI Summit Global Corporation.

He cited three main reasons for this.

“Firstly, more than 70 per cent of the population live in rural areas. Secondly, only 20-25 per cent of adults have bank accounts. Thirdly, Myanmar has a lot of infrastructure deficiencies. There are a lot of difficulties to access banking facilities and power shortages,” Shigeno said at the Mobile Money & E-Commerce Summit 2016 last week.

The draft of mobile financial service regulations was completed recently with the support of Japan’s Bank of Tokyo-Mitsubishi UFJ (BTMU), KDDI and its local partner Myanmar Posts and Telecommunication (MPT), who are cooperating with BTMU to provide mobile money services in Myanmar.

According to Shigeno, many products will soon be available and the market is likely to evolve quickly.

MPT aims to provide mobile financial services in three phases, starting later this year. Initially, it will allow cash-in (deposit), peer-to-peer transfer, self airtime top-up, international remittances, and basic bill payment. In the second phase in 2017-2018, extensive merchant bills payment and links to mobile shopping will be introduced. In the third phase scheduled to start in 2019, saving products, basic loans and insurance products will be introduced.

Shigeno noted that service providers should not focus just on sales and signing customers up. Instead, they need to educate customers and incentivise regular usage. Agents must be trained for long-term success.

Strong agent network management is the “make or break” factor in the success of the mobile money business, he said.

Richard Buttenshaw, commercial director of ConnectNPay, noted that Myanmar needs to leapfrog in terms of technology.

“I see Myanmar as the last frontier for the telecommunication industry. As Myanmar is such an exciting market that we now have a chance to shape a future economy. We need to change the face of business and society for the better things to come,” he said.

Buttenshaw highlighted the need to ensure service providers in place and cooperate with Yangon City Development Committee (YCDC), as Yangon is a commercial hub. He also urged YCDC to widen its base. It currently has four departments.

Oo Thein Myint, chief compliance officer and deputy general manager of CB Bank, said in an earlier interview that mobile banking will become the most promising and popular service in the near future, as it is the most convenient for all users.

“Now almost everyone has at least one mobile phone. Some local banks such as CB and Aya Bank have implemented mobile banking,” he said.

CB Bank has built up an agent network to promote their services.

Source: ELEVEN

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