Kampala — The United Nations has urged the partner states of the East African Community (EAC) to introduce rules and regulations to coordinate the use of mobile money services in the region.

A recent study report compiled by the United Nations Conference on Trade and Development (UNCTAD) on the theme comparative study on the existing platforms and regulations says that there 15 mobile money platforms owned by different operators in the EAC.

It says that in EAC, where mobile subscription numbers are determined on the basis of active SIM cards (make or receive call/SMS) over a 90-day period.

"Given that many individuals own multiple SIMs, this compounds computing mobile teledensity, mobile money subscriptions reflect customers that have completed both registration andactivation procedures for the service, but provide no indication of whether customers have ever made any transaction or how recently," said the report released last week.

It says that consumer protection laws in the EAC belong to different legislative areas such as competition, telecommunications and banking, and cover a range of specific processes like protection against fraud and the transparent flow of information.Within EAC, central banks cover some aspects related to the protection of financial sector consumers, while telecommunications regulators oversee some consumer protection aspects related to communication.

However, there is currently no comprehensive multi-sectoral consumer protection legislation or mandated authority in any of the EAC countries. For mobile money, central banks in EAC have varying minimum requirements that mobile money platforms need to meet in this respect before they receive clearance to operate.

While these requirements are not in the public domain, they include keeping up-to-date records of mobile money accounts opened, the identity of account holders, and the transactions in which they engage. The bank partners are liable to the central banks for these records and perform periodic audits at the MNO to ensure compliance.

The Central Bank of Kenya has taken a leaf from the telecommunications regulators' book and reserved the right to publish comparative information across competing providers that may include their fees and quality of service (clause 12c) as a way to protect consumers.

Additionally, the Central Bank of Kenya Draft Regulation for the Provision of Electronic Retail Transfers (clause 10) requires that mobile money providers also engaged in other business must "ring fence" mobile money depositor cash by keeping it in separate accounts from those of its other operations. Central banks in the United Republic of Tanzania and Uganda

There are currently no regional telecommunications regulations in EAC. However, national telecommunication authorities are operational in all EAC countries.

Some international guidelines on telecommunication services do exist, and may serve as useful starting points as EAC further develops regulatory frameworks in the mobile money and telecommunications sectors. For example, the World Trade Organization, of which all EAC countries are Members, has served as a development forum for the General Agreement on Trade in Services (GATS) Annex on Telecommunications

(Annex),69 as well as the 1998 WTO Telecommunication Services Reference Paper (Reference Paper).70 The Annex and Reference Paper both identify important aspects of telecommunications regulation that are worth considering in relation to mobile money.

These include transparency in licensing procedures, interoperability/ interconnection between telecommunication networks, resource allocation (e.g., with regard to frequencies, numbers, and rights of way), and competitivesafeguards.

Another important concept identified in the Annex is the need for technical cooperation at international, regional, and sub-regional levels.

The issue of interoperability in relation to telecommunication networks is highly relevant in the context of mobile money.

Mobile money platforms are still walled gardens-where customers can exchange mobile money only within a particular network, with each operator keeping others at bay.

Currently, none of the mobile money platforms within EAC interface or directly work with another platform. For example, a user of MTN Uganda's MobileMoney cannot send money that directly ends up in the mobile money wallet of an Airtel Uganda user.Rudimentary interoperability does exist through cash on all platforms or via bank accounts in M-Kesho or Iko Pesa, and a registered user could theoretically send mobile money to another user on a different network,who receives an SMS and can draw cash atan agent and in turn load it onto their phone using a different agent.

Such a process, however, is cumbersome and costly in terms of fees. Therefore, a fundamental question for the central banks is whether such fees cannot pay for mobile money interoperability.

There is, after all, a surcharge for voice interoperability across networks. Mobile money interoperability could potentially Nationally, the implementation of e-commerce legislation is not uniform across EAC although all the partner states do recognize that their implementation of such laws will have an impact on the development of mobilemoney within the region.

Another aspect relates to SIM-registration, promoted by communication regulators across EAC as a way to curb crime. While there is no data to backup this claim, even those that brought in SIM registration in Burundi, Kenya and Tanzania, have yet to disconnect users that do not comply with the directives.

Anecdotally, discussions with private sector representatives in both Kenya and the Tanzania point to pressure from operators as well as fear by government of losing tax revenue as possible reasons why unregistered SIMs have not been disconnected.

SIM registration can be a double-edged sword for small businesses because not much is known about how it will affect businesses participating in the mobile ecosystem and thriving around selling new SIMs and related services.