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Telcos Are Becoming Banks for The Next 2Bn Customers

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By Douglas B. Laney

Telecommunications companies across Africa and Latin America spend $15-21 billion annually on customer retention programs.

Telcos Are Becoming Banks for The Next 2Bn Customers

According to GSMA Intelligence’s State of the Industry Report, telcos in Sub-Saharan Africa lose up to 67% of their customers each year, despite spending 10-14% of their revenue on customer retention efforts.

Meanwhile, these same customers desperately need financial services that traditional banks often fail to provide.

The fix might already exist. Every smartphone in Lagos or Lima contains more processing power than major banks had twenty years ago.

Yet telecom companies use them only for calls and data, missing a massive opportunity to transform these devices into financial infrastructure.

Three Forces Reshaping the Financial Market

However, three global trends are occurring to encourage an expansion and stickiness of the services telcos provide:

First, 2 billion people are getting connected for the first time, mostly through smartphones in developing countries.

The ITU reports that 2.1 billion people remain unconnected or under-connected globally, with 96% in developing nations.

But unlike early internet users who dealt with dial-up and basic websites, today’s new users get immediate access to sophisticated applications and stable networks.

Second, these markets altogether skip the traditional banking evolution. The World Bank’s Global Findex Database shows 1.4 billion adults remain unbanked, concentrated in regions where mobile money already dominates.

Rural Colombia never built bank branches.

Nigerian villages never installed ATMs. So when mobile payments arrived, people switched from cash directly to digital money without the friction of introducing banks or changing established habits.

“The mobile industry has never been more important to the world’s citizens and economy,” says Mats Granryd, Director General of GSMA. “Mobile money is a game-changer for the financial inclusion of women and other underserved groups.

It provides a gateway to a wider range of financial services, including savings, credit, and insurance, which can help people build resilience and improve their livelihoods.”

Third, global financial control has begun to fragment. The Bank for International Settlements found that only 3 of 114 central bank digital currency pilots have actually launched, with most failing due to technical problems and poor adoption.

BRICS nations built their own payment systems. Some countries added Bitcoin to their national reserves. The old centralized system no longer holds sway.

Chris Surdak, CEO of ReLeaf Financial, puts it bluntly: “The World Bank, the World Economic Forum, CBDCs, all were aligning to constrain free market adoption of cryptocurrency..After decades of dipping our toes in these waters, people are now ready to cross the crypto Rubicon in force.”

From Payphones to Phones that Pay

Most people haven’t considered the possibility of earning money while their smartphones sit idle.

However, ReLeaf developed a patent-pending system called “Proof of Intent” that turns phones into transaction validators.

When someone in Peru sends money to their family, phones in Colombia could verify the transaction.

Phone owners can earn small cryptocurrency rewards that add up to cover data plans, airtime, or groceries—thereby potentially solving the loyalty and retention problem.

“There are billions of people living on three or four dollars a day if they’re lucky,” Surdak explains. “How can you meaningfully exist today without being digitally connected? ReLeaf makes both happen at the same time.”

Claro, a major Latin American telecom, calculated that there is over $350 million in potential new revenue out there over the next five years, with significantly lower churn. This doesn’t even require any new infrastructure, just software updates to existing apps.

Dante Disparte, Chief Strategy Officer at Circle, sees broader implications: “In many parts of the world, having access to a stable currency is not a given.

Stablecoins can provide a safe and reliable store of value for people in countries with high inflation or political instability.” He adds that stablecoins are programmable, which “opens up a whole new world of possibilities for financial services in emerging markets, from micropayments and remittances to decentralized finance applications.”

David Chaum, the inventor of digital cash in the 1980s and creator of much of the encryption that protects modern transactions, warned about surveillance capitalism decades before Facebook existed. Yet he just joined ReLeaf’s strategy team.

“ReLeaf is what I have always dreamed that cryptocurrency would be,” Chaum says. “A win for telcos, retailers, and consumers.”

Coming from the man who founded DigiCash in 1989 and whose patents enable every secure transaction today, this means something. Chaum wanted regular people to control their money without surveillance or permission. He imagined cryptography empowering individuals, not corporations. After forty years, he sees it happening through ReLeaf’s approach: phones earning money for their owners without tracking or central control.

The Merging of Emerging Markets

Traditional banks in New York or London can’t pull this off. They face centuries of regulations, customers expecting physical branches, and systems held together with outdated COBOL code. Emerging markets don’t have that baggage.

In Kenya, M-PESA proved it. One telecom company, using basic phones and zero banking infrastructure, now processes half of Kenya’s GDP. The GSMA’s 2024 Mobile Money report reveals that global mobile money transactions exceeded $1 trillion, with Africa accounting for 70% of that volume.

Elizabeth Rossiello, CEO of AZA Finance, stresses the need for local solutions: “Africa is not a country. It’s a continent of 54 different countries, each with its own regulatory environment, its own currency, its own challenges, and its own opportunities. You can’t have a one-size-fits-all approach.”

She’s watched the transformation firsthand: “The future of payments in Africa is mobile. We’ve seen a huge leapfrog effect, where many people have skipped the traditional banking system and gone straight to mobile money. This has created a massive opportunity for innovation in the digital payments space.”

 

Laney, is a Contributor Data, Analytics and AI Strategy Advisor and Researcher

 

 

 

 


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Ebere Melum-Nwogbo is a trained and practicing journalist. She is passionate about ICT and business journalism. She has over a decade experience spanning money and capital market as well as information technology

E-Financial

UBA Beefs Up Mobile App Security to Stop Fraudulent Debits, Withdrawals

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United Bank for Africa (UBA) has said that it has strengthened the security of transactions on its mobile application to stop fraudulent debits, unauthorised transfers and withdrawals.

UBA Beefs Up Mobile App Security to Stop Fraudulent Debits, Withdrawals

Oliver Alawuba, Group Managing Director and CEO of United Bank for Africa

UBA announced this in a memo forwarded to its customers via email recently.

“We are pleased to inform you that we have further strengthened the security of transactions on the Mobile App.

“Updated authentication options now apply based on the value of transfers,” the memo reads in part.

UBA said in the memo that it had introduced authentication options for transactions of varying amounts to detect and prevent fraud.

According to the bank, transactions of N200,000 or more will now require customers to provide their Personal Identification Number (PIN) and a token number.

For transactions above N200,000 and N250,000, customers will be required to provide their PIN and a One-Time Password (OTP).

They can make use of their PIN and Biometric or PIN and Token numbers to authenticate such transactions.

Customers will be required to provide a PIN and OTP, or a PIN and Token number, when carrying out transactions between N250,000 and N500,000

For transactions between N500,000 and N10 million, customers must enter their PIN and Token to authenticate the transaction.

For transactions above N10 million, customers must use their PIN, Token, and Biometric to complete the transaction.

“The app will guide you, no need to memorise these thresholds,” the bank assured customers in the memo.

 


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E-Financial

CBN Plans New Payment Systems Vision

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Central Bank of Nigeria (CBN), has said that it will be launching a new payment systems vision that will outline where the entire ecosystem is expected to be heading in the next three years.

CBN Plans New Payment Systems Vision

Olayemi Cardoso, governor of the Central Bank of Nigeria

The vision was co-created with the financial technology players, the mobile money operators, payment service providers across the board.

This was announced by Muhammad Abdullahi, deputy governor, Economic Policy Directorate at the CBN, after the inaugural meeting of the Payment Service Providers Committee.

Olayemi Cardoso, governor of the Central Bank of Nigeria, inaugurated the first meeting of the Payment Service Providers Committee, to reinforce policy coordination, knowledge sharing, and also ensure collective problem-solving by the industry and by the central bank.

The committee is being chaired by Muhammad Abdullahi, CBN deputy Governor, Economic Policy, and co-chaired by Philip Ikeazor, deputy Governor, Financial System Stability Directorate.

Other members of the committee include stakeholders from all the key payment service providers that are licensed to operate in Nigeria as well as a number of regulators, the Nigerian Communications Commission (NCC), Nigeria Deposit Insurance Corporation (NDIC) and the Securities and Exchange Commission (SEC).

According to Abdullahi, the committee is expected to convene on a quarterly basis to interface with players in the industry, to ensure that they collectively solve some of the challenges that are facing the industry.

“The committee is to put Nigeria on the best footing forward in terms of payment system space. As we already know, Nigeria is a world leader in payment service provision.

“The kind of technology and fintechs deployed in Nigeria are far ahead of regional and continental peers. And what we want to ensure over the next five to 10 years is that we continue to maintain this leadership and be able to do much more for the Nigerian economy,” he said.

He stated that setting up the committee had become relevant with the remarkable growth trajectory seen in the digital payment landscape in Nigeria.

“In 2024 alone, the system processed over 11.2 billion electronic transactions, amounting to over N1.07 quadrillion. This is the first time that digital payments crossed the quadrillion naira threshold, representing significant growth.

“The momentum has continued. In 2025, we’ve seen significant growth, and of course, in the first few months of 2026 as well. This is an ecosystem that is significantly growing, that has significant implications for growth in Nigeria, for inclusive growth, for trade, and other significant positives for our country, he said.

The Deputy Governor, Financial System Stability Directorate, and co-chair of the committee, explained that the inaugural meeting, featured discussions such as preliminary issues around how participation is going to be, what the top-line issues are, and some of the committees that would be set up eventually.

He said, “What we intend to do is to be able to solve this in a much faster way. So in the past, companies would have to wait a significant amount of time to interface or lay their concerns to the central bank, and the central bank would have to do supervisory visits—on-site, off-site—to be able to carry out its responsibilities.

“But today, now, we have a platform that brings us all together, that has committees that are working towards specific mandates that can advance the payment systems space, you know, payment service provider space. So what we really have now is that a major bottleneck has been removed, which is the bottleneck of coordination, collaboration, and joint systems thinking”.

On her part, Foyinsolami Akinjayeju, chief executive officer of Enhancing Financial Inclusion and Advancement (EFInA), said that the inaugural meeting of the Payment Services Providers Committee was to ensure that innovation was not stifled.

She said, “The Payment Services Providers Committee will more importantly, allow for inclusive and sustainable growth through access, expansion, strengthening of trust to ensure that no segments of our economy is left behind”.

Also, Premier Oiwoh, managing director and chief executive, Nigeria Inter Bank Settlement System (NIBSS), lauded the initiative describing it as historic and a win for all Nigerians.

For Jay Alabraba, chairman, Association of Licensed Mobile Payment Operators, the initiative is a good one which will help sustain the nation’s growth through active participation of industry stakeholders.

 

 


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E-Financial

Ghana Makes History as First African Country to Integrate Payment National Identity Card

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Ghana becomes the first African country to integrate payment into its Citizens’ Identity Card, ditching US-based payment giants Visa and Mastercard in Africa.

Ghana Makes History as First African Country to Integrate Payment National Identity Card

The card is now widely accepted in over 190 countries for online, in-store, and ATM use.

It allows for secure purchases, international payments, and offers perks like insurance and emergency assistance.

Ghana Card holders can activate their card using the MyCitizens App or by dialling *402#

Recall that Ghana’s National Identification Authority (NIA),  statutory body mandated to establish a national identification system, first announced in September 2025, that the card would allow users to make use of Automated Teller Machines (ATMs), make payments in stores and online, make international payments with over 200 countries, and access other services such as insurance and emergency assistance.

The NIA’s aim for developing this feature is to bolster financial inclusion within the country.

In Ghana, the credit card penetration rate was forecast at 0.6% in 2024 and was forecast to continuously decrease between 2024 and 2029.

 

 


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