Do not tax mobile money services – Juniper Research

Do not tax mobile money services – Juniper Research

Kenya and Uganda are the first African countries to introduce tax on the increasingly popular mobile money services offered by network operators.

“While the impact on the Kenyan market appears to have been limited thus far, we should point out that this is the most mature mobile money market,” report author Windsor Holden said.

“The introduction of a similar tax in a market in the early stages of service adoption could serve as a severe brake on growth or make potential service providers reconsider planned deployments.”

The report, released in the United Kingdom, revealed almost 400 million mobile phone users worldwide are expected to use their handsets for money transfers by 2018.

This would be up from just under 150 million and the growth is expected to be driven primarily by deployments of domestic money transfer services, with multinational network operators increasingly launching products group-wide rather than on a country by country basis.

Additionally, the report argues there is a need for service providers to ensure that a support infrastructure, including an extensive agent network, is in place well in advance of commercial launch.

It argued that the agent/subscriber ratio should be no greater than 1:500 to ensure a high proportion of active users, with strong agent concentrations at the outset in key urban areas within developing markets.

Juniper’s research also identified the key criteria for “Mobile Money Incubators”, assessing the optimal conditions to nurture mobile money service deployment and development, and highlighting markets which fulfilled these criteria.

Airtime top-up is also viewed as the primary mobile international remittance opportunity and money transfer platforms are becoming increasingly modular and flexible to enable integration of future bolt-on services.

Posted in: FeaturedMobile

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