NGOs in Africa embrace mobile payments

Mobile payments offer a quick, secure and convenient alternative to Africa's relatively limited banking infrastructure

In a continent where only 20% of people have a bank account but 50% use a mobile phone, Africa-based NGOs are using innovative mobile payment technology to meet their complex cash-disbursement needs.

By partnering with mobile payment enablers like Citi, NGOs can now send payments directly to a recipient's mobile phone via an integrated electronic banking platform.

Given Africa's relatively limited banking infrastructure, the widespread use of cash has previously been unavoidable for NGOs working in remote areas. Transporting large amounts of cash carries a substantial security risk and makes control and accountability a challenge.

Mobile payments offer a quick, secure and convenient alternative. Citi now provides a number of NGOs with an integrated mobile payment system through its CitiDirect Online Banking platform, in partnership with Mobile Network Operators (MNOs) throughout Africa.

An organization's cash manager can input or upload transaction details into CitiDirect, along with the beneficiary's mobile number instead of an account number. The usual approvals are then completed, as with any electronic payment to a bank account.

Citi then transfers the instruction to its MNO partner's platform for payment, and sends confirmation advice to the NGO for reconciliation and accounting.

The beneficiary can then exchange the e-payment in their mobile wallet for cash at a variety of agents, or make e-payments of their own to another beneficiary.

Participating agents include corner shops, petrol stations, chemist, mobile phone dealers and other retail outlets.

For NGOs, this means large volumes of payments can be made to multiple recipients via a single electronic banking platform, with accurate record-keeping, reconciliation and financial reporting back to donors.

The technology is also instrumental in promoting financial inclusion, bringing Africa's unbanked into the financial system. In Kenya, around 70% of adults are registered with a MNO to manage fund transfers via their mobile phone.

Citi has worked in Africa for over 50 years and has a deep understanding of NGOs and their needs. Empowering the underprivileged with financial services will be an important step in the continent's economic and social development.