New Price Tables from Mobile Money and Traditional Operators: Rash of Strategic Moves?

On 1 August 2017, MTN Mobile Money (MoMo) and Orange Money (O.M.) launched new price tables for their remittance services whereby O.M. introduced sending fees to direct-account transfers and MoMo increased its sending fees.

On 2 August 2017, Express Union responded to the Telco players with a new price list for Express Union Mobile. A comparative viewpoint of the new mobile money prices indicates the following:

  • EU Mobile has the most competitive prices (lowest sending fees and fairly low withdrawal fees) as opposed to those offered by Orange Money & MTN Mobile Money.
  • Regarding transfers to direct-accounts, EU Mobile offers the best deal because they are free of charge.
  • As for sending fees to other accounts, MoMo’s fees are the highest as oppose to those of EU Mobile and O.M. albeit the fact they charge the same rates for transfers between FCFA 20 000 to FCFA 50 000.
  • With regards to withdrawal fees, O.M. offers the best fees for amounts ranging from FCFA 100 to FCFA 50 000, MoMo for transfers ranging from FCFA 50 000 to FCFA to FCFA 200 000 and EU Mobile stands out with the most alluring fees for amounts above FCFA 300 000.

Faced with above the price war launched by the mobile money operators, Express Exchange, reacted by introducing a new price list which reduces its first-transfer-fee by 50% (from FCFA 300 to FCFA 150) and its transfer amounts from 30 to 29. Two weeks later (15 August 2017), Express Union announced the launch of a new price schedule which also drops its first-transfer-fee by 50% (from FCFA 400 to FCFA 200).

Mindful of these remittance-fee adjustments (action and reaction), a few questions come to mind: are transfer volumes dropping at the POS, are the digital operators overtaking the market, are the operators targeting a specific group of consumers or are they desperate to boost profit margins at all cost? A kin analysis of the above fees, nonetheless, point to the following conclusions:

  • The digital operators intend to make their offers more competitive as oppose to those proposed by the traditional operators.
  • The reduced in transfer fees enables them to pull more consumers to their counters and increase transaction volumes
  • The segmented transfer bands also allows the operators to boost their consumers’ purchasing power
  • The operators are also able to reach and serve a wider variety of consumers including those with low incomes
  • Through this Pull strategy, the operators can, thus, guarantee continuous transactions at the POS and maintain market growth.

It is true that desperate times call for desperate measures and these operators, via the most recent moves, are obviously fully engaged in saving the market from Declining. Notwithstanding, caution is advised for the choice of strategies to implement as well as the appropriate time for implementation.

Source: Market Survey (Posters in agencies)

 

Major Hightlights of the Cameroon Remittance & Mobile Money Market in August 2017

Partnership Development

  • MTN Cameroon signed a deal with Camair-Co, Cameroon’s airlines company. The partnership permits all MoMo subscribers to instantly pay their flight tickets from their mobile accounts without necessarily going to the agency.  Subscribers just have to call the Camair-Co customer service at 2 33 50 55 00 and give details of their flight including: name, date, hour, email address and telephone number. No need wasting more time on queues at Camair-Co agencies.

Service Innovation

  • Express Exchange has simplified the remittance procedure at all its agencies by taking off sending and receiving forms from its counters. Its customers just need to provide their name, telephone number, amount, receiver’s name and destination. Express Exchange is the third operator in the market after Express Union and Emi Money to adopt this simplified transfer procedure at its agencies

New Price Tables

  • MTN Mobile Money, Orange Money and EU Mobile have introduced new sending and withdrawal fees for their respective mobile money platforms. This to render their packages more competitive, encourage active usage, boost transaction volumes and attract a wider variety of new subscribers.
  • Express Exchange and Express Union have also launched new transfer fees for their respective remittance services at all their POS in Cameroon. This reaction came shortly after their digital competitors introduced their new prices on the market.  

Some Illustrative Pictures

MTN Mobile Money New Transfer Fees

orange new prices

Most Recent EU Mobile Fees

express exchange

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