MTN has shut down its mobile money offering in South Africa.
The service has been in operation since 2012, but two weeks ago MTN stopped allowing new customers to sign up. The service has now been officially discontinued, with a statement reading: “Following much deliberation, MTN South Africa has taken a decision to decommission its Mobile Money offering due to lack of commercial viability.”
The decision echoes Vodacom’s shuttering of its M-Pesa mobile money service in May. Both Vodacom and MTN have seen significant uptake of their mobile money offerings in other African markets, demonstrating the difficulties faced by such services in South Africa.
Part of the issue is that compared to many African countries, South Africa has significantly more developed traditional banking infrastructure and services. This means that there is not such a strong incentive for consumers to adopt mobile money.
MTN has confirmed that its mobile money offerings in other African markets will continue unaffected. While its South African service gained 2 million registered customers, chief consumer office Larry Annetts stated that operating costs were now “prohibitive”. He did however note that MTN was open to exploring other financial services in South Africa.