18 January 2013

Uganda: Telecoms Not Worried About Competition From Orange Money

The entry of Orange Money in the mobile money business has not scared the old players, with most saying they have the "best" infrastructure to win the mobile money market.

The Ugandan mobile Money market is run by MTN Uganda that pioneered the service in 2009, Airtel that joined a year ago, Uganda telecom, Warid and now Orange.

"Competition is good and we believe it gives customers more choice and also makes the industry more efficient," Shailendra Naidu, the chief commercial officer for Warid Telecom told The Independent on Jan. 17. He added: "But of course the one with the best product will benefit. He said they welcome Orange money in the market but said, they were working hard to ensure their network infrastructure is stable so that the customers benefit.

"In just one year of our operation in this subsector we have been able to control 10 percent of the market share in this subsector," he said.

He said as part of their effort to attract more customers, they were encouraging new ones to register their Sims as well as for Warid Pesa.

James Mutebi, the consumer marketing manager at Uganda telecom told The Independent on Jan. 17 that the mobile money service is taken as a "retention element" for most telecom companies (they use it to retain their customers so they stick to their respective network). He said telecoms are in the mobile money business partly because they want to prevent their customers from exiting their network.

Mutebi said the launch of Orange Money "does not deviate anything from their plans. "We believe our mobile money network is the most stable," he said, quickly adding they have over 600, 000 customers on M-Sente and were hoping to grow the number over time.

Reports say the number of mobile money transactions since the inception of the platform is estimated at 84.7 million as of 2011, with a total value of Shs3.75 trillion wired through the platform. At the end of December last year, mobile commerce users in Uganda stood at 2.8 million, up from 1.8 million the year earlier. This means that at least 18% of the total mobile phone subscribers are registered users of mobile money services.

Copyright © 2013 The Independent. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 2,000 reports a day from more than 130 news organizations and over 200 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.