For the first time in Egypt, the telecommunication market may soon witness the appearance of mobile banking, Angy Essam reports Egyptian cell phone companies are now asking the Ministry of Communication to give them the authority to provide, for the first time in Egypt, the transfer of money via mobile phone service. This service will assist banks in their role by permitting customers to carry out money transfers through an easy, fast and secure way which will enable banks to concentrate on other services. The companies say they have been negotiating with the Central Bank of Egypt (CBE) and the National Telecommunication Regulatory Authority (NTRA) to launch this service for more than two years and yet nothing has been achieved up to this moment. "This project was presented for the first time about two years ago," said NTRA Chairman Amr Badawi. This new service, he added, was delayed because of the regulatory actions taken by NTRA to guard against money laundering, especially because this service must be subject to continuous controls and security preparations. Badawi added that NTRA will discuss the approval of launching this service in its first board of directors' meeting to take a quick decision especially after receiving prior approval from the CBE. However, he refused to set a certain date for the service to start. An official source in one of the largest cell phone companies informed Al-Ahram Weekly that the transfer of money via mobile service will facilitate the procedure of payment and transfer of money without having to deal with the banking institutions or any other private or governmental organisations, as the whole process will be between the mobile applicant and the cell phone companies' branches and retail stores all over Egypt. The source said the new service will be designed accurately targeting a large sector of society, who finds it difficult to deal with the banks. The source stressed that the transfer will be inside Egypt only. Mobile owners who work outside of Egypt will not be able to use this service as a substitute for the banks to transfer remittances. The source said he expects that the value of each transfer will not exceed LE3,000. This will be a precaution against fraud, money laundering, and hacking as transfers of large amount of money cannot be controlled and secured like small amounts, especially since the service will be new to the market. He added that the fees for this service will not exceed three per cent of the value of the transfer and therefore will be cheaper than other methods. This will open the door to more services offered through mobile phones. Currently the number of mobile phone users stands at around 72 million. The source explained that both the CBE and NTRA were hesitant to allow this service due to the insufficient experience in cell phone companies. It was first necessary to find the suitable legal and financial frameworks to govern the service and ensure its security. The delay was also due to difficulties in securing a large number of money transfers via mobile phone against hackers who can simply hack any mobile number during the transfer process and divert the money before it reaches its rightful receiver. The source explained that the mobile phone towers and SIM cards used in Egypt may be subject to penetration. Hackers can also manipulate money transfer operations via mobile phone in the absence of an integrated information system to secure such operations, which will lead to noncompliance with the international standards that are necessary to provide such kind of services. The source said he expects this service will be launched very soon, and will help in increasing the number of mobile users due to the important role it will play in facilitating money transfers. Commenting on the position of the banking sector regarding this new project, Osama Hassan, retail manager in one of the largest private banks in Egypt, told the Weekly that there is no conflict of interest between the banks and the cell phone companies as this service cannot replace the role of the banks. Hassan said banks provide a much wider range of services and that mobile transfers will be local only and limited to small amounts of money. He said the transfer of money via mobile phone is used now in many countries all over the world and has not affected the role of the banks. Hassan added that, on the contrary, this service will help banks by carrying out a small part of the heasvy duties they perform daily. If this service had any conflict of interest with the banks, he said, the CBE would not have given its approval. Money transfer via mobile service is currently available in Jordan, United Arab Emirates, Bahrain, Saudi Arabia, Oman, Qatar, Kuwait, Lebanon and Yemen. It is also available in some African countries such as Kenya since 2007, performing around one million money transfers per day, creating as a result of the application of this service about 30,000 new job opportunities in this African state.
