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Encouraging Use of
Mobile Money in Africa
Like its peers, Africa, too, is taking the threat
of COVID-19 very seriously. As a safeguard,
mobile money has been called into service, to
address this challenge. In Kenya, Ghana,
Uganda and Rwanda, mobile money providers
have enforced a slew of customer-friendly
measures. From waiving off service charges
on selected financial transactions to increased
daily and monthly transaction limit, the
customer is truly in the spotlight. Not just this,
but the Bank of Ghana, the country’s central
bank is going to relax existing Know Your
Customer (KYC) regulations. This is aimed at
enabling more people to adopt and use mobile
money in time of this health crisis [4] . In Kenya, a
majority of churches have suspended Sunday
service and directed members to stay at home
and pay their tithes and offerings through mobile
[5]
money services . Jumia, one of the biggest
online retailers in Kenya, has stopped use of
‘Cash on Delivery’ amid rising shopping of
essential products directly delivered to home.
Jumia is asking clients to pay upfront or make
payments via digital platforms like mobile
money on time on delivery [6] .
March 2020
Supporting the Low Income
Population and Small and
Medium Businesses
Of course, global preventive measures, such
as the “lockdown” has a significantly adverse
economic impact on an individual’s earning,
especially low income daily wagers and small
and medium businesses. To counter this,
governments are providing financial support.
For example, in the Indian state of Uttar
Pradesh, the state government is giving INR
1,000 to two million registered labourers and
1.5 million thela (kiosk) and rickshaw pullers. [7] .
The sum will, needless to say, be paid digitally
through their bank accounts via the Direct
Benefit Transfer (DBT). This initiative is, of
course, aided and abetted by the Jan Dhan
low-frill bank accounts created by the
government. To say that this robust financial
inclusion infrastructure is now coming in handy
to provide emergency funds to low income
people is certainly an understatement!
Globally as well, small and medium sized
businesses (SMBs) are facing the brunt of
the pandemic. To help SMBs, banks in the US
to China are waiving off fees, deferring loan
repayments and providing low income loans.
In China, the state-council has ordered large
state-owned banks to increase lending to
small businesses by 30 per cent in the first half
of 2020. The official interest rate set by the
central bank for commercial lenders providing
credit to small business, rural areas, farms and
[8]
agriculture firms has been set at 2.5 per cent .
This will be ensured by the recent spurt
growth in online banks and digital finance in
China, naturally.
[4] Mobile World Live
[5] Daily Nation
[6] Business Daily
[7] Times of India
[8] South China Morning Post
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