Page 14 - Tanzania-Enabling-Mobile-Money-Policies
P. 14
enaBLinG moBiLe moneY PoLiCieS in tanZania
• Distribution: to become a mobile money agent, the agent must be a registered company with at least five outlets to offer the ser-
vice. at least two of these outlets should be located in rural areas. an investment of tZS 2,000,000 (approx. USd 1,480) in the cash
float is required for each active outlet. there is also a special category of agents who may not have the minimum number of outlets,
but would provide services in convenient locations (such as banks, hotels and major supermarkets). these companies only need to
operate one outlet to qualify for the services, but the agent must be willing to invest at least tZS 5,000,000 (approx. USd 3,700)
in the cash float for each outlet. the providers are permitted to use the agent aggregator model, which contributes greatly to over-
coming the challenges of liquidity management and active monitoring of the distribution network. the aggregator model enables
21
master agents to transfer float to their sub-agents as needed, alleviating the burden on service providers to monitor thousands of
individual shops. agents should also be able to demonstrate that they will offer quality service by meeting staff resource require-
ments and by implementing procedures to keep floats balanced.
• AML/CFT regime and know your customer (KYC) procedures: Following the Financial a ction task Force (FatF) guidance, the regula-
22
tor has adopted a proportionate amL/CFt regime that allows the providers to delegate a number of critical functions to their agents and
to implement tiered Cdd . agents are responsible for facilitating cash withdrawals and deposits, registering users and the due diligence
of new customers. t hey are required to comply with the provider’s anti-money Laundering and Combating the Financing of t errorism
(amL/CFt) policy and are trained to follow specific procedures in the case of suspected fraud or money laundering.
Since there is no national identity document (id) system in place in tanzania, customers often use voter registration cards to validate
their identity. other valid forms of id include pension cards, passports, and employee cards. agents are required to make a copy
of the id and submit it to the provider that keeps it on file for future customer validation. if a copy of the id cannot be retained by
the agent then the customer is registered as a tier 1 customer, which limits the customer to an account with an annual throughput
value of tZS 1.7 million (approx. USd 1,045). if a copy of the id can be retained and is sent to the provider for verification then the
customer is registered as a tier 2 customer and is eligible for an account with an annual throughput of tZS 50 million (approx. USd
30,750). even though the regulator allows providers to set up different types of accounts, so far the only operator that has imple-
mented different tiers is vodacom (see table 1). in 2009, the tCra requirement to register all new Sim cards gave vodacom and the
other mnoS the opportunity to conduct KYC verification of all existing subscribers.
agents are also required to record transactions by hand in a logbook. For each transaction, the agent enters: account balance, date,
agent id, transaction id, transaction type (customer deposit or withdrawal, agent cash rebalancing), value, customer phone number,
customer name, and the customer’s national id number. most of this information is copied from the confirmation SmS that the agent
receives. Customers are then asked to sign the log for each transaction, which helps to discourage fraud.
• Customer assistance: all mobile money deployments provide 24/7 dedicated customer care call centres. Calls to the customer
care centre are free.
the Bot crafted the provisions of the letters of no objection to enable mobile money in the early stages, under their watchful eye: “From the
onset of mobile financial services in t anzania, the Bot permitted the service using a regulatory regime that is conducive and supportive of
the innovative product that was considered to potentially increase financial inclusion; these include the Bank of t anzania act, 2006 and the
Guidelines for electronic Payment Schemes, 2007. t his enabled the Central Bank to have effective oversight of the non-bank led service.” 23
table 1
M-pesa Tiered K yc and TransacTion liMiT s
iMpleMenTed by v odacoM
AccounT MAxiMuM TrAnsfer MAxiMuM AccounT
Type size DAily TrAnsfer liMiT BAlAnce cusToMer Due Diligence requireMenTs
Tier 1 tZS 1,000,000 tZS 1,000,000 3,000,000 Customers shows id to the agent
(US$ 1,845)
(US$ 615)
(US$ 615)
Tier 2 3,000,000 5,000,000 5,000,000 Customers shows id to the agent, who makes
(US$ 3,075)
(US$ 1,845)
(US$ 3,075)
a copy that the providers stores
Tier 3 12,000,000 50,000,000 1,000,000,000 Customers shows id, taxpayer identification
number (tin) and business licence to the agent,
(US$ 61,500)
(US$ 30,750)
(US$ 7,380)
who makes copies that the providers stores
21. Liquidity management in tanzania is challenging for mobile money providers because the formal banking system is relatively undeveloped. the number of bank branches per 100,000 inhabitants is only 0.57, and this low
density makes it difficult for agents to manage their cash floats. agents must travel long distances to find a bank branch where they can renew their floats, which means they spend less time in their shops and may not be
able to top up their floats as often as they need to.
22. See Simone di Castri and raadhika Sihin (2014), “Proportional risk-based amL/CFt regimes for mobile money: a framework for assessing risk factors and mitigants”, GSma mobile money for the Unbanked (mmU),
http://www.gsma.com/mmu
23. interview with the national Payments System directorate, Bank of tanzania, January 2013.
8
• Distribution: to become a mobile money agent, the agent must be a registered company with at least five outlets to offer the ser-
vice. at least two of these outlets should be located in rural areas. an investment of tZS 2,000,000 (approx. USd 1,480) in the cash
float is required for each active outlet. there is also a special category of agents who may not have the minimum number of outlets,
but would provide services in convenient locations (such as banks, hotels and major supermarkets). these companies only need to
operate one outlet to qualify for the services, but the agent must be willing to invest at least tZS 5,000,000 (approx. USd 3,700)
in the cash float for each outlet. the providers are permitted to use the agent aggregator model, which contributes greatly to over-
coming the challenges of liquidity management and active monitoring of the distribution network. the aggregator model enables
21
master agents to transfer float to their sub-agents as needed, alleviating the burden on service providers to monitor thousands of
individual shops. agents should also be able to demonstrate that they will offer quality service by meeting staff resource require-
ments and by implementing procedures to keep floats balanced.
• AML/CFT regime and know your customer (KYC) procedures: Following the Financial a ction task Force (FatF) guidance, the regula-
22
tor has adopted a proportionate amL/CFt regime that allows the providers to delegate a number of critical functions to their agents and
to implement tiered Cdd . agents are responsible for facilitating cash withdrawals and deposits, registering users and the due diligence
of new customers. t hey are required to comply with the provider’s anti-money Laundering and Combating the Financing of t errorism
(amL/CFt) policy and are trained to follow specific procedures in the case of suspected fraud or money laundering.
Since there is no national identity document (id) system in place in tanzania, customers often use voter registration cards to validate
their identity. other valid forms of id include pension cards, passports, and employee cards. agents are required to make a copy
of the id and submit it to the provider that keeps it on file for future customer validation. if a copy of the id cannot be retained by
the agent then the customer is registered as a tier 1 customer, which limits the customer to an account with an annual throughput
value of tZS 1.7 million (approx. USd 1,045). if a copy of the id can be retained and is sent to the provider for verification then the
customer is registered as a tier 2 customer and is eligible for an account with an annual throughput of tZS 50 million (approx. USd
30,750). even though the regulator allows providers to set up different types of accounts, so far the only operator that has imple-
mented different tiers is vodacom (see table 1). in 2009, the tCra requirement to register all new Sim cards gave vodacom and the
other mnoS the opportunity to conduct KYC verification of all existing subscribers.
agents are also required to record transactions by hand in a logbook. For each transaction, the agent enters: account balance, date,
agent id, transaction id, transaction type (customer deposit or withdrawal, agent cash rebalancing), value, customer phone number,
customer name, and the customer’s national id number. most of this information is copied from the confirmation SmS that the agent
receives. Customers are then asked to sign the log for each transaction, which helps to discourage fraud.
• Customer assistance: all mobile money deployments provide 24/7 dedicated customer care call centres. Calls to the customer
care centre are free.
the Bot crafted the provisions of the letters of no objection to enable mobile money in the early stages, under their watchful eye: “From the
onset of mobile financial services in t anzania, the Bot permitted the service using a regulatory regime that is conducive and supportive of
the innovative product that was considered to potentially increase financial inclusion; these include the Bank of t anzania act, 2006 and the
Guidelines for electronic Payment Schemes, 2007. t his enabled the Central Bank to have effective oversight of the non-bank led service.” 23
table 1
M-pesa Tiered K yc and TransacTion liMiT s
iMpleMenTed by v odacoM
AccounT MAxiMuM TrAnsfer MAxiMuM AccounT
Type size DAily TrAnsfer liMiT BAlAnce cusToMer Due Diligence requireMenTs
Tier 1 tZS 1,000,000 tZS 1,000,000 3,000,000 Customers shows id to the agent
(US$ 1,845)
(US$ 615)
(US$ 615)
Tier 2 3,000,000 5,000,000 5,000,000 Customers shows id to the agent, who makes
(US$ 3,075)
(US$ 1,845)
(US$ 3,075)
a copy that the providers stores
Tier 3 12,000,000 50,000,000 1,000,000,000 Customers shows id, taxpayer identification
number (tin) and business licence to the agent,
(US$ 61,500)
(US$ 30,750)
(US$ 7,380)
who makes copies that the providers stores
21. Liquidity management in tanzania is challenging for mobile money providers because the formal banking system is relatively undeveloped. the number of bank branches per 100,000 inhabitants is only 0.57, and this low
density makes it difficult for agents to manage their cash floats. agents must travel long distances to find a bank branch where they can renew their floats, which means they spend less time in their shops and may not be
able to top up their floats as often as they need to.
22. See Simone di Castri and raadhika Sihin (2014), “Proportional risk-based amL/CFt regimes for mobile money: a framework for assessing risk factors and mitigants”, GSma mobile money for the Unbanked (mmU),
http://www.gsma.com/mmu
23. interview with the national Payments System directorate, Bank of tanzania, January 2013.
8
