Robert Matau




Two rival mobile phone giants in Fiji have banded together to launch the Short Messaging Service banking system, marking a new era in Fiji’s banking industry.
Digicel and Vodafone have for the first time come together under Bank South Pacific in this joint service to provide an option for people to make transactions, check their balances, thus avoiding the long queues in banks.
Obviously, in a nation like Fiji where networks are highly advanced compared to neighbouring nations in the region, the mobile banking service is expected to skyrocket profits for the bank and mobile operators, while making it more convenient for those who do not have the time to travel 10 km to their nearest bank.
In the past, you needed to access an ATM or a bank to get cash—today that role is being transferred to the simple ownership of a mobile phone.
While Vodafone launched its own M-PAiSA product first, BSP, the giant in the Pacific in this area, is providing SMS to its 50,000 customers in Papua New Guinea.
M-PAiSA is a mobile phone-based money transfer mechanism that allows registered users to send and receive money directly on their mobile phones.
Effectively, what it means is that your mom-wallet and store of money in electronic form’.
But the two products, plus Australia and New Zealand Banking group’s own ATM top up service with Digicel, herald a new era of mobile companies entering the financial sector in Fiji.
Launching the product, BSP chief executive Ian Clyne said SMS banking gave their customers easy and convenient access to their account information.
“No matter how busy you are or even if the bank is closed, you can still access your bank account from the convenience of your own lounge room, using your mobile phone,” he said.
“If someone wants to do SMS banking with BSP, as long as you have access to the network, then you can take the SMS product from BSP.
He said on pricing arrangements—obviously in the long-term, it will be the standard SMS pricing.”
While the BSP product may be distinct from Vodafone’s M-PAiSA, it is certainly does herald the use of a mobile compared to seeking a bank branch to send funds to dloved ones at odd hours or far away.
Fiji’s Reserve Bank Governor Sada Reddy while launching e-money services in Fiji in early June, said they had been working towards the introduction of mobile money services in Fiji since 2009.
“A National Financial Inclusion Taskforce, comprising representatives of the public and private sector was formed early this year to drive initiatives such as this e-money Project.
“Financial exclusion has been a problem for Fiji.
“Some recent studies indicate that access to financial services in Fiji is approximately 35-40 percent. In other words, most of the poor and rural and maritime dwellers do not have adequate financial services.”
Reddy said as proven in other parts of the world, mobile money is seen as the new way of providing financial services using mobile phone technology and network.
“The launching of e-money Project in Fiji is timely as developing countries such as Kenya, Uganda, Pakistan, and the Philippines have embraced e-money initiatives to extend financial services to the unbanked, which are mostly the poor,” Reddy said.
In some of these developing countries, penetration and uptake of mobile phonex, ranges from 45-60% across the population, which includes unbanked users.
In Kenya, as of January this year, mobile money users were approximately 9 million, which is 23% of Kenya’s population using the M-Pesa services, with approximately US$3.6 billion transfers being conducted.
In the Phillippines, during the same period, there were approximately 9.2 million mobile money users or 9% of its population with transaction volumes totalling approximately US$3.3 billion.
“From this penetration rate and volume of transfers, we can only imagine the huge possibilities and the positive impacts mobile money services will have in our country,” he said.
Penetration or coverage rates of our local mobile phone network operators have been estimated to range from 80-90% of the population.
Reddy said mobile money services by the two companies Digicel and Vodafone would be introduced in phases.
Whilst the main regions like Suva, Nausori, Nadi, Lautoka and Labasa will be covered at the early stages, it is expected that services will be extended to the remote and outer islands gradually and to cover the whole region by the end of next year.
The other area this type of service is expected to boost is remittances and banks like BSP and mobile companies will be exploring these possibilities.
“It is important to note that international remittances outward is not approved at this stage.
“Inward remittances from abroad however can be transacted using mobile phones, but this service will be available down the road.
“This, we hope, will further increase remittances into Fiji.”