Mama Money was launched today, 26 January 2015, and is the first South African company to be licensed as an Authorised Dealer with Limited Authority (ADLA), Category three Money Transfer Operator by the South African Reserve Bank. On 12 December 2014, Mama Money's license was gazetted by the South African Parliament, allowing the company to open its doors for operation.
Who will be serviced?
At present the service will only be available to migrant workers sending money to Zimbabwe. However, Mama Money is in the process of getting the service ready to launch into other African countries.
Mathieu Coquillon, co-founder and director of Mama Money, said: "We have identified that the biggest need is to Zimbabwe. We are going to launch there. But while we were waiting for our license to be approved, we were in talks with Malawi, Zambia and Mozambique. Our next corridor will be Malawi, and we will continue to look at the other Southern African countries."
Mama Money benefits include:
- Immediate transactions
- Eliminating the need for cash, thereby increasing security
- Being able to personalise the process via social media and mobile technology
According to Coquillon, Mama Money offers its clients more personalised service than other money transfer operators as it only requires customers to submit their information once, whereas other operators require re-submission each time you transfer money. Once you have been registered as a member you have a profile where you can add your recipients.
Coquillon explains: "When you create an order we send a message to you, we send a message to the person receiving the money, so throughout the whole process we communicate with everyone. And in phase two of our web development our customers will be able to upload from Facebook. So on their Mama Money profile if they have a recipient who is their mom, they will be able to add one of their mom's photographs to it for a bit of personalisation on the system itself."
The minimum amount that you can send in one transaction is R500, and the maximum amount is R5 000. However, there is a monthly transfer limit of R25 000.
How much does it cost?
Mama Money have launched with a 5% flat fee charge. So if you transfer R1000, you'd pay R50 in fees. According to Mama Money, on average one third of a migrant worker's income is sent home each month. They state that South Africa is the most expensive country in the world for these workers to send home low value transfers, especially to neighbouring Southern African countries.
"We also don't charge any margins on our exchange rates, so the savings that we are able to negotiate on exchange rate with the banks we are able to pass on to our customers," highlighted Coquillon.
How does it work?
Mama Money has agents that assist people in registering for this service. These agents are members of the community. They use smartphones to register customers once-off for the service. Coquillon explained that the registering needs to be done face-to-face so that the company is compliant with Financial Intelligence Centre Act (FICA) requirements.
"The agent will take photographs of the FICA documents and upload them. We then approve this at head office and the customer receives an SMS to say that they have been activated and can start sending money," said Coquillon.
Once users are registered, customers log on to the Mama Money website or for non-smartphone users there is the *120* menu, and add the details of a recipient. This will include the recipient's name and cell phone number.
Once the customer is registered and the recipient details are loaded, the customer will pay the money into one of Mama Money's bank accounts via electronic funds transfer (EFT). The money will then be transferred to the recipient's e-wallet, and the recipient can then go to the bank and withdraw the money.
As Mama Money is a standalone money transfer operator, it is not affiliated with a single bank. Coquillon revealed: "We are standalone in that we can do our own reporting to the Reserve Bank and we don't need a partner bank. But we obviously collect our money through the traditional banking infrastructure. We have accounts with all of the major banks in South Africa [Standard Bank, First National Bank, Absa and Nedbank], so depending on who our customer banks with we direct them to do an EFT transfer to the same bank."
Approximately 100 people are already registered with Mama Money and test transactions have been carried out.