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Mobile Money: How It Works

Although Mobile money differs from Mobile banking or Internet banking as the latter involves use PC, you use your cell phone. You get 24/7 access to mobile banking, mobile payment, mobile wallet, mobile money transfer and other financial services, from anywhere. Demonstrating how the mobile money works, Mr Paul Lawal, the immediate past CEO of Nigeria Inter-Bank Settlement System (NIBSS), said that all the mobile payment companies in the country are linked to the central switch which is already linked to every bank and network.

Then how does a phone subscriber apply it? “We have the NIBSS instant payment”, he explains, “with this, you can instruct your bank even at the point of purchase that you would want to move money to a beneficiary on your mobile phone. And the beneficiary will receive the money in less than 10 seconds. And the sender will be informed through his own mobile phone that the money has been paid to the beneficiary. For the NIBSS instant, the key thing is that that customer must make himself available in the payment platform of the bank.” Furthermore, Mobile Money transforms your mobile phone into an electronic wallet (e-wallet).

You can store funds in your mobile e-wallet for making electronic payment for goods and services, to transfer funds to family and friends. This reduces your need for cash when shopping and might help you handle cash with the daily limits of the CBN. You can also receive money on your mobile money e-wallet. Your e-wallet can be funded via autorised agents of your mobile money service, partner banks and networks of your mobile money service, transfers from your ATM/Debit cards, or any other funding method offered by your service provider. Once funded you can securely and conveniently use your mobile money to send money to family and friends, buy airtime of any network, Pay bills like DSTV, PHCN bills, etc.

You can also withdraw cash from your e-wallet at same locations. Most transactions like sending and receiving money, deposit, or withdrawal will cost a transaction fee as specified by the service provider. Some services may also charge a monthly rental so, inquire from the mobile money agent before signing up.

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