By : Mr. Boukary ZONGO Director Of Opération and Electronic Banking Standards GIM-UEMOA

1. PROMOTING MOBILE BANKING AND MOBILE MONEY DEVELOPMENT IN UEMOA REGION By : Mr. Boukary ZONGO Director Of Opération and Electronic Banking Standards GIM-UEMOA

2. SHORT PROFIL • Mr. Boukary ZONGO • : boukary.zongo@gmail.com • or boukary.zongo@gim-uemoa.org • : +221 77 446 06 65 • ou +221 77 377 80 43 Mr. Boukary ZONGO is currently the Director Of Operations and Electronic Banking Standards of GIM-UEMOA, the regional regulator body and guardianship of electronic banking for West Africa Economic and Monetary Union federating 8 countries, 104 banks and Central Bank. Previously, he has worked a long term as an electronic bank expert in private banks and with Central Bank to define regional rules and standards before the creation of GIM-UEMOA in 2003. He has also worked before in a biggest Research Center and Private society in Luxembourg, Europe. ZONGO trains students in master 1 and master 2 electronic banking. He animate many West Africa regional seminars federating 50 to 300 people coming from different countries. ZONGO has degrees from Ouagadougou University Burkina Faso, Henri Poincaré University, Nancy 2 University FRANCE.

3. CONTENTS • UEMOA IN BRIEF • GIM-UEMOA IN BRIEF • BACKGROUND AND OBJECTIVES  • GIM-MOBILE CHARACTERISTICS • DEPLOYMENT AND PROMOTION • CONCLUSION

4. UEMOA EN BRIEF

5. UEMOA IN BRIEF • UEMOA, THE WEST AFRICAN ECONOMIC AND MONETARY UNION IS AN EXPERIENCE WHICH BASIC FEATURES ARE : • the pooling of the foreign exchange reserves of the member countries • the adoption by the 8 countries of a CFA franc, a common currency issued by a single central bank • the application of a uniform banking and financial legislation throughout the Union.

6. UEMOA IN BRIEF BANKS AND FINANCIAL INTITUTIONS Source : « Banking Committee Report 2010 »

7. GIM-UEMOA IN BRIEF

8. UEMOA HAVE THREE MAJOR SYSTEMS REFORMS AT THE REGIONAL LEVEL : A real time gross settlement system (RTGS) for large value payments called STAR-UEMOA. An interbank electronic clearing system called SICA-UEMOA An interbank card/ mobile-based payment system managed by GIM-UEMOA The real time gross settlement system (STAR-UEMOA) and the interbank electronic clearing system (SICA-UEMOA) are directly managed by the Central Bank BCEAO. GIM-UEMOA is in charge of the interbank card/ mobile-based payment system. UEMOA PAYMENT SYSTEMS REFORM

9. GIM ACQUIRER GIM ISSUER ATM INTERBANK SERVICES POS CARDHOLDER

10. GIM IN BRIEF

11. TRANSACTIONS FROM 2007 TO 2011

12. SECURE ENVIRONMENT GIM-UEMOA : EMV and MAGSTRIPE VISA : EMV and MAGSTRIPE EMV PCI-DSS L2 MASTERCARD : EMV and MAGSTRIPE PCI-DSS Level 1 certification will be completed in 2012.

13. PROSPECTS Banks, Financial Institutions, Postal Facility, Microfinance  Institution, Ectronic Money Institution , etc.. UEMOA countries and others countries CFA and foreign currency ATM POS Internet Mobile French, English, Portuguese and Local Langages Cards (debit, prepaid, credit/ GIM, VISA, MCI) Mobiles (bank accounts, prepaid) Fingerprints (bank accounts, prepaid)

14. BACKGROUND AND OBJECTIVES

15. Observation: About 90 million people Banking rate < 10% of the workforce GIM-UEMOA members : 104 institutions Institution interconnected : 82 Electronic banking Park: 2,000,000 cards, 2,000 ATMs and a 1,000 POS. Detention card rate < 3%. The cost of cards, ATM / ATM and POS as well as the quality of telecom infrastructure in parts of the Union cause the GIM and its members to seek additional means of payment. BACKGROUND

16. Mobile telephony: Penetration rate : 60% Sustained growth over several years. The mobile phone therefore becomes an indispensable complement to the development of electronic banking channel (cards, ATM, POS, Internet, etc..) This is the purpose of GIM-MOBILE, a project initiated in January 2011. The official launch was made on December 8, 2011. BACKGROUND

17. OBJECTIVES • Expanding the network GIM-UEMOA to rural areas as well as town in UEMOA Region. • Offer available products and services for a larger number of people, including those with low income and unbanked. • Significantly increase the rate of electronic payment means in UEMOA region. • Contribute actively to the increase of banking. • Significantly expand the share of electronic transactions in financial flows.

18. GIM-MOBILE CHARACTERISTICS

19. REGULATORY FRAMEWORK • Two documents define the conditions for issuing electronic money by UEMOA institutions : • REGULATION No. 15/2002/CM/UEMOA ON PAYMENT SYSTEMS IN THE MEMBER STATES OF UEMOA REGION. • 01/2006/SP OF EDUCATION July 31, 2006 REGARDING THE ISSUANCE OF ELECTRONIC MONEY AND ELECTRONIC MONEY INSTITUTIONS.

20. REGULATORY FRAMEWORK • In UEMOA region, can issue electronic money : • Banks • The electronic money institutions (EME): any financial institution, postal facility, service provider company approved as EME by the Central Bank BCEAO. • A telecom operator as any institution can issue electronic money in coordination with a bank or EME. In this case, the bank or EME shall guarantee all transactions made by the telecom operator and the project must be validated. • We note as well the development of mobile payment solutions in the UEMOA.

21. MOBILE SOLUTION SAMPLES • Find below mobile banking/ payment solutions deploy in UEMOA Region : • BENIN : MTN MONEY, LA POSTE, MOOV. • BURKINA : INOVA PAY, MONEY ZAP, FERLO • COTE D’IVOIRE : ORANGE MONEY, CELPAID, eTRANZACT, SCASH, PME CASH • GUINEE BISSAU : ORANGE MONEY • MALI : ORANGE MONEY, FERLO • NIGER : AIRTEL MONEY, ORANGE MONEY • SENEGAL : ORANGE MONEY, YOBANTEL, FERLO • TOGO : TOGOCEL, MOOV. • A dozen of local developed mobile solutions are being implemented.

22. REGULATORY FRAMEWORK • We note an important number of mobile solutions in UEMOA region. In addition, key market players (banks, mobile network operators, providers of payment services, etc.) are unable to agree on a viable business model for interoperable payment solutions, "hence a risk of fragmentation by the adoption of proprietary solutions. • The stated objective by the GIM-UEMOA is to increase transparency and security of payments, to stimulate competition and innovation within the single market: the eight UEMOA countries. An update of the regulatory framework will be done this years.

23. GIM-MOBILE IN BRIEF • This new regulatory framework will be accompanied by a technical foundation for accelerating a rapid and coherent development of mobile banking in the UEMOA. Capitalization will be performed on the world of banking cards with: • A interbank component to interconnect the various mobile banking solutions in the region according to predefined rules and standards. Which allows customers and merchants to perform operations in an "open loop". • Delegated component to pool and make mobile solutions accessible to all institution regardless of its size and financial capacity.

24. GIM-MOBILE GIM CLEARING PREPAID MOBILE BANK ACCOUNT DEBIT/CREDIT CARD PREPAID CARD SWITCH CENTRAL BANK SETTLEMENT BANKs TELECOM OPERATORS MONEY TRANSFER COMPANY ACCEPTEORS AND MERCHANTS WESTERN UNION BILLERS ORANGE MONEY EXPRESS TAXES AND CUSTOMS TIGO WARI … MOOV … … RIA … MTN BANK1 MONEY GRAM ORGANIZATION BANKn

25. GIM-MOBILE IN BRIEF • GIM-MOBILE integrates on a single platform: • Interbank Mobile • Mobile banking, • Mobile payment, • SMS Banking, • Branchless/ Rural banking. • It offer various banking products and services on the mobile phone. He brings a real answer to the problem of the proximity of banking products and services and increasing the banking rate.

26. GIM-MOBILE IN BRIEF GIM-MOBILE is addressed both : banked and unbanked population. Customer can access to bank account, credit card, a virtual account pre-loaded or a combination thereof. PREPAID ACCOUNT BANK ACCOUNT DEBIT / CREDIT CARD

27. BANK1 BANK1 BANK2 BANKn BANK2 BANKn Money Transfer Taxes and customs Bills payment Etc. SMS, Base I, Base II MDS, CIS, IPM GIM-CARD GIM-MOBILE … … Mobile customer Mobile merchant POS Card holder Card Holder ATM POS ATM Legend : Online Version : 1.2 Offline

28. GIM-MOBILE IN BRIEF • With the lack of quality of telecom infrastructure, GIM-MOBILE use differents types of connections: • GPRS, • WIFI, • Encrypted SMS, • Clear SMS • USSD INSTITUTION TELECOM OPERATOR GIM-MOBILE

29. DEPLOYMENT AND PROMOTION

30. DEPLOYMENT PLAN • 2011: Project initiation and Official Launch • 2012: Pilot with different types of actors (banks, telecom operators, acceptors, money transfer company, etc.) • 2012-2014: Developing the network of service points: • Using the network of banks, financials institutions, postal facility branches in UEMA Region • Using the network of ATMs / ATM and POS WAEMU • Recruitment of mobile and business correspondent (job creation)

31. NETWORK DEVELOPMENT • strategy: • Promoting services that interest people • Proceed a mesh of UEMOA 8 countries through: • With the approval of mobile agents; • Recruitment of small traders trained to promote the service • The use of the network GIM-UEMOA (104 members including 13 banks in Mali and their business customers); • The use of automatic teller machines (ATM) operating 24h/24 and 7/7. • Promote the network • Branding & Merchandising service points • Securing the Network • Service points at hand: • Geo-location of residential areas, attendance billers subscribers, etc.

32. PROMOTIING OF CROSS BORDER TRANSACTIONS • REGIONAL: CENTRAL BANK BCEAO AND GIM-UEMOA • Creating a dedicated structure: ok with the GIM-UEMOA • Defining an electronic payment rules: ok. • Reform of systems and methods of payment: technologies and innovations are changing very quickly. Need to adjust regulations on a regular basis. • Establishment of a technical platform: ok with the GIM-UEMOA • A framework for consultation and decision: OK with the regional conferences and national electronic banking committees.

33. PROMOTING CROSS BORDER TRANSACTIONS • REGIONAL: CENTRAL BANK BCEAO AND GIM-UEMOA • Improvements: • greater involvement of states and telecoms operators. • Transactions limits control define for reducing systemic risk but sometimes value inappropriate to the needs of the population. • Promotion initiated but insufficient • Statutory instruments little known even lawyers.

34. PROMOTING CROSS BORDER TRANSACTIONS • NATIONAL: • STATES: PROMOTION POLICY OF ELECTRONIC PAYMENT MEANS. EACH STATE CAN : • mandate domiciliation of salary in an account (banking, prepaid, etc.). • mandate the payment by electronic payment means of any amount above a threshold . • sensitize and educate the public. All these provisions must be accompanied by an information policy, education and awareness.

35. PROMOTING CROSS BORDER TRANSACTIONS • NATIONAL : • PUBLIC AND PRIVATE COMPANIES • Public organization: customs, taxes, ministries, etc.. • Private organization : water, electricity, phone companies, others private structures • Regional and international organization : thus, for example ASECNA through a collaboration with the GIM-UEMOA has made ​​it mandatory from 30 november 2011, payments by electronic means rights and airport taxes.

36. HOW TO BOOST MOBILE BANKING IN UEMOA BOOSTING MOBILE BANKING IN UEMOA REGION CAN BE DONE : • THE DEPLOYMENT OF INTERBANK AND OUTSOURCING MOBILE BANKING PLATEFORM, • THE DEVELOPMENT OF MOBILE BANK POINTS OF SERVICE ACCESSIBILITY, • PROMOTION OF MOBILE BANKING PRODUCTS AND SERVICES.

37. HOW TO BOOST MOBILE BANKING IN UEMOA • DEPLOYMENT OF INTERBANK AND OUTSOURCING PLATEFORM • Interbank will allow interoperability between different mobile solutions. • Outsourcing is dedicated for institution with low income but a potential development . • Define rules, quality charter mandatory for the different mobile banking solution in UEMOA Region. • Customize the solution taking care of what people really need.

38. HOW TO BOOST MOBILE BANKING IN UEMOA • POINT OF SERVICE ACCESSIBILITY • Mesh network from banks, financial institutions and postal, telecom operators, • Recruitment of master partners, wholesalers, retailers. • Adequacy of service quality, cost of service for low-income population. • Usability of the product by customers, whatever their level of education • The customer service (availability of an access point and support 24/24, 7/7)

39. HOW TO BOOST MOBILE BANKING IN UEMOA • PROMOTION AND AWARENESS • Educational: use relay (schools, universities, etc.). In association with different regional schools ,integrate training modules on mobile banking (marketing, legal, computer, electronic banking, financial, etc.). • Informational: organizing meetings, forum, seminars, etc. Participate in strategic meetings  in the region. • Advertising: advertising media and non media (television, radio, newspapers, posters, etc.)

40. CONTRIBUTION OF DEVELOPMENT PARTNERS • PROGRAM FUNDING • EDUCATION PROGRAMS. This is introduced  mobile banking(IT,marketing,legal,accounting,etc.) in the educational system of schools and universities training modules • TRAINING PROGRAM. This is to train actors in the chain of mobile banking transactions (technicians,  distributors, coordinators, etc.). • CAMPAIGNS AND PROMOTION. The use of fiat money is rooted in the habits of the population. Changing habits and reverse can be done through campaigns.

41. CONTRIBUTION OF DEVELOPMENT PARTNERS • ACCOMPANYING MODERNIZATION PROGRAM • Support acceptors wishing to modernize their chain of acceptance of payment by electronic means of payment above the informal sector. • Support the development of technical infrastructure (electricity, phone, telecoms, etc.), especially in rural areas.

42. RISK CONTROL • The risk control is a very important issue. • Control measures against money laundering and terrorist financing will be systematically integrated into the framework of this project. • Thus, regional cooperation with structures specialized in the fight against money laundering and terrorist financing is necessary. The GIM-UEMOA working within this framework with GIABA, Intergovernmental Action Group against Money Silver.

43. CONCLUSION

44. GIM-UEMOA promote Mobile Banking and Mobile Money for banked and unbanked people in UEMOA Region. • We include in our strategy people with low income and rural areas taking care about the cost and identifing all services that real interest these people. • UEMOA Region, with the high population numbers, lack of access to financial institutions and significant mobile penetration rates, is an ideal region for mobile banking and payments deployment. Providing an interoperable solution to the unbanked population will help the region continue to grow and evolve both economically and socially.

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