Mobile Money Challenges On Policies, Regulation And Security Frauds In East Africa

Abstract

Mobile monetary transaction services are engulfing in most of the developing countries predominantly east Africa and providing financial inclusion to large unbanked communities. Mobile money is an electronic carrier money that allows users and customers to deposit, withdraw, transfer, pay bill, top up and internet recharge through their mobile money system without carrying any hard cash. Mobile money has included large unbanked population in to the financial transaction system which banks have never reached. Though mobile money has changed the traditional way of financial transactions, there are challenges that the new electronic financial system is confronting. First policy, rules and regulations are non-existence as this machinery is embryonic to the commercial environment. Banks who are the ultimate money regulators comprehends the intensification of mobile money as threat to themselves and if they are not involved in the implementation, policy and rules of the currency it will get worse because the telecommunication network operators who run mobile money have no knowledge and experience the financial management. Moreover, governments which are also the definitive money controller are afraid this money transfer platform, because of the scarcity of financial inflation, money laundering, security and privacy vulnerability and terrorist transaction involvements. In all together, the mobile money are changing the traditional financial risk management requirements and transaction policy control environment. In this survey paper we highlighted the importance of mobile monetary transactions, policy, rules, regulations and challenges in the developing east African countries. The paper also outlines the potential security fraudsters and attackers.