Revisiting RICA – The Issue of SIM Registration
Posted: December 4th, 2009 | viewed: (1,102) | Comments: ( 0 ) | Topic: Blog Post |
In August we reported that South Africa was revising their RICA provisions to prohibit mobile network operators from registering new SIM cards without first capturing the customer’s identity. We’re now seeing the first signs of how this implementation of mandatory SIM registration will impact the mobile market. MTN’s regulatory affairs executive, Zolisa Masiza, has confirmed that since August 1, there has been a 30% reduction in the sale of SIM cards. Rural areas have been hit particularly hard, which isn’t surprising given that residents in these areas are less likely to have the mandatory ID documents needed to register – and agents are less able (or willing) to comply with required processes.
The issue of mandatory SIM registration will undoubtedly have some impact on the development of mobile money – not just in South Africa, but in markets around the world. In theory, identifying millions of mobile subscribers could aid in the deployment of mobile money. That is, mandatory SIM registration could create opportunities to cost-effectively verify a customer’s identity – in a way that would comply with requirements of financial regulators. We’ve even seen operators proactively use mandatory SIM registration as an opportunity to promote a mobile money offering – in Tanzania, M-PESA have used the approach of saying ‘you need to provide this information anyway, so why not register for an e-wallet at the same time…’
But in many cases, there will be challenges. In the case of South Africa, the stringent SIM registration requirements and processes are offsetting some of the progressive financial inclusion measures introduced through FICA. Further, the ‘simplified registration’ theory can be complicated by the fact that, in some cases, airtime dealers will simply register multiple SIMs in their own identity on behalf of customers to eliminate the new inconvenient process. But that’s a challenge that mobile operators will no doubt design solutions to address.
The question of whether mandatory SIM registration is good or bad for mobile money will not be core to arguments for or against the initiative. The issue is focused more so on crime prevention, but the implications to our industry could be significant. We’ll track this issue as markets continue to weigh the benefits against drawbacks. In the meantime, please tell us how you think the implementation of mandatory SIM registration would affect mobile money in your market (or how it already has…).
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