Dar es Salaam. A Global company RegTech (which deals with managing regulatory processes within the financial sector through technology) has established its mobile money compliance platform in Tanzania as part of a deliberate effort to further strengthen the security of the country’s mobile money transactions. Global Voice Group (GVG) has set up its M3 platform for the Tanzania Communications Regulatory Authority (TCRA).
Tanzania is Africa’s second-largest mobile money market after Kenya.
M3 is the leading mobile money compliance platform on the continent. GVG’s M3 solution is a data acquisition and processing system for tracking all mobile money transactions in any country, according to GVG CEO James Claude.
TCRA’s M3 system captures all transaction data from every mobile money application for tracking, verification and analysis. It also allows the regulator to monitor developments in the mobile money market and the level of compliance with Tanzanian laws and regulations.
Mobile money penetration in Tanzania reached 53%, with 29.7 million mobile money subscriptions, in 2020, up from 21 million in 2018, an increase of 41%.
As of June 2020, mobile money transactions worth a total of 10.6 trillion shillings (approximately $ 4.6 billion) were completed. This is an increase from the 9.46 trillion shillings that were processed in May 2020 – and 8.3 trillion shillings processed in April 2020.
The numbers are staggering – and therefore the impact of regulation on the economy is very significant.
“For more than seven years, GVG has supported the TCRA and the Central Bank (BoT) in their oversight of $ 247 billion in mobile money transactions, bringing them into the compliance circle via the M3,” Mr. Claude.
The move aims to ensure the crucial role of surveillance through automated surveillance, data analysis, identification of suspicious transactions and background checks using international criminal and financial databases.
So far, GVG has facilitated the verification of mobile money transactions valued at $ 360 billion around the world.
According to the GSMA State of the Industry on Mobile Money 2019 report, there were a total of 469 million mobile money users in Africa in 2019, making the continent the most dynamic region in the world in terms of money transactions. mobile.
In 2019, the sub-Saharan region recorded 23.8 billion mobile transactions, amounting to more than $ 456 billion, and the Covid-19 health crisis had a catalytic effect on the expansion of the money market mobile.
Going forward, the mobile money market is expected to reach a transaction value of $ 216.4 billion by 2024, growing at a compound annual growth rate (CAGR) of 28.7% in 2019. -2024.
While this digital transformation means greater financial inclusion for the unbanked population, the rapid expansion of the sub-sector requires better regulation. Indeed, the risks associated with these applications are multiple, including illicit financial flows, identity theft, money laundering, terrorist financing and non-compliance with national standards. Cybercrime is now considered one of the top 10 global risks.
According to the 2018 ITU Global Cybersecurity Index, Africa has the fewest number of countries with a cybersecurity strategy – with just a third of them using metrics to measure cybersecurity. This lack of digital protection affects governments, businesses and citizens, posing a threat to the stability and growth of the continent.
Indeed, cybercrime comes at a cost: around $ 3.7 billion per year, according to a study carried out by the cybersecurity company Jighi in 2018. This threat could slow the development of the African digital economy.
Recently, hackers have used around 2,000 mobile SIM cards to access the mobile money payment system in Uganda. It is reported that at least $ 3.2 million was stolen in this incident.
“Faced with this growing insecurity, Africa must invest considerably in cybersecurity in order to calmly tackle the fourth industrial revolution. This is an essential issue for the 460 million mobile phone users on the continent ”, declared Mr. Claude.
He adds that “GVG’s SafetyNet suite effectively addresses the digital challenges of governments and regulators using cutting-edge tools, in accordance with privacy laws.”
This led the company to be recognized as one of the top 30 RegTech companies, in the RegTech Directory of the audit firm Deloitte.
There is still a clear need to effectively support law enforcement, policy compliance and security across national internet and mobile ecosystems, and effective oversight of digital and mobile identities.
Given the impact of mobile money, the anticipated growth of the industry and the resulting increased reliance on technology, it is clear that the role of RegTech companies will become increasingly important in the future as as governments seek to address the increased need for transparency and regulation in the telecommunications industry, as well as the range of cybersecurity threats that will emerge.
Technology is constantly evolving and governments continue to push for the rapid adoption of solutions for a digital nation, in order to remain competitive as a country.
Data-driven decision making is essential to ensure that the benefits of digitization are not diluted.
Technological innovation and infrastructure must therefore also continue to strive and stay ahead of the dynamism of the industry in order to protect both citizens and governments from the plethora of risks brought about by the Fourth Industrial Revolution.