Telepin Software has announced that it has clinched a deal to power the mobile financial services for Mascom Wireless Botswana. Telepin was selected to migrate from the incumbent provider to deliver the next wave of digital services in Botswana.
In its press release, the Canadian based financial technology (Fintech) firm says that Botswana's mobile penetration is the highest in the world at 176% and with Mascom Wireless having the dominant share of the market, the partnership could unlock many opportunities in the digital sphere, particularly in the payments system. The Canadian firm says opportunities exist given that the country's financial sector is mostly informal with 97% of businesses transacting with customers via cash.
“Mascom's partnership with Telepin accelerates and increases the availability of mobile money services for the country's citizens, while positioning banks, payment services providers, and online service providers to participate and succeed in an expanding mobile money ecosystem,” Telepin announced in a press statement.
Telepin powers over 40 active Mobile Financial Services platforms with tier one mobile operators around the world. Telepin's unique software and services help mobile operators deliver robust financial services offerings to their subscriber and merchant customers. According to the company, their software plugs seamlessly into existing mobile infrastructure, leveraging the investments already made in charging systems, replenishment systems, and value added service delivery platforms. Telepin is currently enabling over 45M digital wallets across all their customer networks processing over 50 million transactions per day.
The deal to completely takeover and power Mascom’s mobile financial services is a nod of confidence to Telepin Software which has already been working with Mascom in their mobile money transfer product. The Mascom flagship mobile money offering MyZaka provides Mascom customers a convenient and secure way to send, receive, buy and pay using their mobile phones anywhere in Botswana. Consumers can use the service to buy prepaid electricity, pay DSTV subscriptions, pay Mascom post-paid bills, send and receive money within Botswana, and purchase airtime. The existing MyZaka service includes a full stack deployment of the best in class software from Telepin Software.
Telepin says the deployment of MyZaka was a game changer in the market at a time where banks were the only ones expanding their digital channels through mobile banking. MyZaka has proven to be popular, especially amongst the unbanked who have no access to fast and secure mobile money transfers. MyZaka already supports a large percentage of active consumers and agents throughout the country.
Vincent Kadar, President of Telepin says "After an extensive process we are pleased to have been selected by Mascom and we value the trusting relationships we continue to build with our customers globally. We look forward to supporting Mascom and its customers with the world's most open, reliable, and innovative system, allowing Mascom to focus on building the digital ecosystem that will drive their next wave of growth."
Mascom- like other mobile operators- is evolving from the traditional ways of making money by shifting focus to expand its digital ecosystem. Research has shown that revenues from voice calls and short message text (SMS) are falling as consumers prefer to use internet powered applications which allows them to chat, voice call and video call using their smart phones. Mobile operators have tapped on another stream of revenues by offering data plans and bundles to meet the high demand for data services.
Mascom was licensed on February 17th 1998 as one of the two companies to establish, maintain and operate a GSM Mobile network in Botswana. The Mascom Network was launched five weeks after licensing, establishing and has been the market leader since. Mascom has maintained the tradition and introduced cutting edge innovative products and services.
In 2007, Mascom led the introduction of GPRS/EDGE network coverage that spans 95% of the population. Mascom was the first mobile operator to launch 3G/HSDPA covering the cities of Gaborone in 2008 and Francistown in 2009. In June 2012, Mascom announced the aggressive expansion of 3.5G technology, which upon completion will see close to 80% of Botswana’s population enjoying the benefits of super-fast broadband access, with speeds of up to 21 Mbps. Concurrent to the 3.5G deployment, the 2.5G network was also upgraded to increase capacity by over 50%.
At the same time Mascom launched the 4G LTE pilot project which positioned Mascom among the first in the SADC region to announce the advanced technology. In September this year, Mascom launched an online portal called Tsena, a multi-platform news and information on Botswana, created to tell “Botswana’s stories about Batswana, by Batswana for the world”. Mascom says through the platform, the company aims to guide Botswana’s digital information, informing, connecting and entertaining users with search, communications, and digital content products and about Botswana. The service is free for mascom users.
This century is always looking at improving new super high speed technology to make life easier. On the other hand, beckoning as an emerging fierce reversal force to equally match or dominate this life enhancing super new tech, comes swift human adversaries which seem to have come to make living on earth even more difficult.
The recent discovery of a pandemic, Covid-19, which moves at a pace of unimaginable and unpredictable proportions; locking people inside homes and barring human interactions with its dreaded death threat, is currently being felt.
Member of Parliament for Kanye North, Thapelo Letsholo has cautioned Government against excessive borrowing and poorly managed debt levels.
He was speaking in Parliament on Tuesday delivering Parliament’s Finance Committee report after assessing a motion that sought to raise Government Bond program ceiling to P30 billion, a big jump from the initial P15 Billion.
Government Investment Account (GIA) which forms part of the Pula fund has been significantly drawn down to finance Botswana’s budget deficits since 2008/09 Global financial crises.
The 2009 global economic recession triggered the collapse of financial markets in the United States, sending waves of shock across world economies, eroding business sentiment, and causing financiers of trade to excise heightened caution and hold onto their cash.
The ripple effects of this economic catastrophe were mostly felt by low to middle income resource based economies, amplifying their vulnerability to external shocks. The diamond industry which forms the gist of Botswana’s economic make up collapsed to zero trade levels across the entire value chain.
The Upstream, where Botswana gathers much of its diamond revenue was adversely impacted by muted demand in the Midstream. The situation was exacerbated by zero appetite of polished goods by jewelry manufacturers and retail outlets due to lowered tail end consumer demand.
This resulted in sharp decline of Government revenue, ballooned budget deficits and suspension of some developmental projects. To finance the deficit and some prioritized national development projects, government had to dip into cash balances, foreign reserves and borrow both externally and locally.
Much of drawing was from Government Investment Account as opposed to drawing from foreign reserve component of the Pula Fund; the latter was spared as a fiscal buffer for the worst rainy days.
Consequently this resulted in significant decline in funds held in the Government Investment Account (GIA). The account serves as Government’s main savings depository and fund for national policy objectives.
However as the world emerged from the 2009 recession government revenue graph picked up to pre recession levels before going down again around 2016/17 owing to challenges in the diamond industry.
Due to a number of budget surpluses from 2012/13 financial year the Government Investment Account started expanding back to P30 billion levels before a series of budget deficits in the National Development Plan 11 pushed it back to decline a decline wave.
When the National Development Plan 11 commenced three (3) financial years ago, government announced that the first half of the NDP would run at budget deficits.
This as explained by Minister of Finance in 2017 would be occasioned by decline in diamond revenue mainly due to government forfeiting some of its dividend from Debswana to fund mine expansion projects.
Cumulatively since 2017/18 to 2019/20 financial year the budget deficit totaled to over P16 billion, of which was financed by both external and domestic borrowing and drawing down from government cash balances. Drawing down from government cash balances meant significant withdrawals from the Government Investment Account.
The Government Investment Account (GIA) was established in accordance with Section 35 of the Bank of Botswana Act Cap. 55:01. The Account represents Government’s share of the Botswana‘s foreign exchange reserves, its investment and management strategies are aligned to the Bank of Botswana’s foreign exchange reserves management and investment guidelines.
Government Investment Account, comprises of Pula denominated deposits at the Bank of Botswana and held in the Pula Fund, which is the long-term investment tranche of the foreign exchange reserves.
In June 2017 while answering a question from Bogolo Kenewendo, the then Minister of Finance & Economic Development Kenneth Mathambo told parliament that as of June 30, 2017, the total assets in the Pula Fund was P56.818 billion, of which the balance in the GIA was P30.832 billion.
Kenewendo was still a back bench specially elected Member of Parliament before ascending to cabinet post in 2018. Last week Minister of Finance & Economic Development, Dr Thapelo Matsheka, when presenting a motion to raise government local borrowing ceiling from P15 billion to P30 Billion told parliament that as of December 2019 Government Investment Account amounted to P18.3 billion.
Dr Matsheka further told parliament that prior to financial crisis of 2008/9 the account amounted to P30.5 billion (41 % of GDP) in December of 2008 while as at December 2019 it stood at P18.3 billion (only 9 % of GDP) mirroring a total decline by P11 billion in the entire 11 years.
Back in 2017 Parliament was also told that the Government Investment Account may be drawn-down or added to, in line with actuations in the Government’s expenditure and revenue outturns. “This is intended to provide the Government with appropriate funds to execute its functions and responsibilities effectively and efficiently” said Mathambo, then Minister of Finance.
Acknowledging the need to draw down from GIA no more, current Minister of Finance Dr Matsheka said “It is under this background that it would be advisable to avoid excessive draw down from this account to preserve it as a financial buffer”
He further cautioned “The danger with substantially reduced financial buffers is that when an economic shock occurs or a disaster descends upon us and adversely affects our economy it becomes very difficult for the country to manage such a shock”