MTN Introduces Mobile Money Overdraft Facility in Uganda Following Success of Safaricom’s Fuliza
MTN Uganda has introduced a mobile overdraft service in the country following the success of the Safaricom MPESA Fuliza overdraft service.
Called Momo Advance, the service is a collaboration between MTN Mobile Money Uganda and NCBA Bank Uganda.
NCBA Bank is the same bank that operates Fuliza, the region’s first mobile overdraft service since 2019 in partnership with Kenya’s Safaricom.
Momo Advance is expected to provide MTN mobile money customers with access to advance mobile money (MoMo) funds that they can use to complete their MoMo transactions and repay later. This follows a successful pilot program with approximately 135,000 subscribers since December 2020.
Available to all MTN MoMo customers, MTN MoMo Advance is an extension of the transaction capability of MTN MoMo customers, allowing them to continue transacting even when they run out of MoMo within an approved credit limit.
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SEE ALSO: Kenyans borrow $10.9m a day from Fuliza, Africa’s leading mobile money wallet overdraft service
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For eligibility, MoMo Advance is open to those who have been using MTN’s mobile money offering for at least 6 months, have passed credit scoring based on their use of mobile money and other MTN services .
Some of the uses of the service include:
- Send mobile money
- Pay for goods and services via MomoPay
- Pay the bills
- It is also available for Enterprises, SMBs, Merchants and Mobile Money Agents
As an overdraft facility, MoMo Advance allows customers to use more money than they actually have in their accounts and the overdraft amount is automatically deducted the next time a customer receives funds in their account. MoMo account.
The service attracts a one-time access fee equivalent to 2.75% of the overdraft amount used and 0.5% daily interest on any outstanding balance. Daily interest will be charged at the end of each day the overdraft is outstanding up to a maximum of 45 days.
In Kenya, Fuliza has become hugely popular with reports revealing that the service lends more than $12 million to Kenyans daily.
African payment gateway, Flutterwave, also recently announced a partnership with MTN’s MoMo service that will allow users to make payments to businesses using their mobile money accounts through Flutterwave.
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RECOMMENDED READING: Mobile Money account holders in Uganda will now start earning interest, says Bank of Uganda
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