1. ITU Workshop on
“ICT Innovations for Developing Countries” (Tunis, Tunisia, 20 June 2012)
SMS Exchange: Mobile credits as an electronic payment channel. Case of RWANDA
Jean Pierre NSHIMIYIMANA
Rwanda Utilities Regulatory Agency
&
Independent Researcher
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2. OUTLINE Overview on Rwanda Mobile Transaction status and Statistics
Challenges for these systems
SMS Exchange System
Conclusion and Recommendations
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3. RWANDA Capital Kigali Area 26,338 km2 Population 10,718,379
Number of Households
2,187,500
Mobile Penetration
42% (April 2012)
GDP
502 USD
Rural Population (2009)
81.4%
Urban Population (2009)
18.6%
Electricity
16% (2012) and 70% (2017)
Terrain
Uplands and hills
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4. Photo: Internet
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5. Mobile Transaction Systems Status
1. Mobile Banking (for Banks)
Eg. To buy electricity
Prerequisites:
To be a Bank customer
To be registered for this system
To have deposit
The money is deducted from user’s bank account directly.
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6. Mobile Banking (Cont.) Statistics
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7. Mobile Transaction Systems Status (Cont.)
2. Mobile Money (for Telecom)
Prerequisites:
To be a Telecom customer
To be registered and to have a mobile money account
To have deposit
The money is deducted from user’s Mobile Money account directly.
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8. Mobile Money (Cont.) Statistics
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9. These systems are very FLEXIBLE & AVAILABLE and technically working well, But…?
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10. The GDP is 502 USD per year CHALLENGES 1. Low Revenue
The little revenue becomes “First Aid”!
There is no need to go for deposit because tomorrow it shall be needed!
The effort to go for deposit = the effort to buy this utility!
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11. CHALLENGE (Cont.)
2.Geography
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12. (For Many) The use of these systems cannot justify the cost to be done
Because people are scattered in the village far from the cities, it becomes difficulty and costly to make a registration and deposit (as prerequisites for these systems).
(For Many) The use of these systems cannot justify the cost to be done
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13. With this situation, the purchasing of some services becomes more DIFFICULT and involves a lot of THIRD PARTY COST like transport and time consuming (especially in remote areas).
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14. SMS EXCHANGE!! Introduction Status Functionality Comparison
Advantageous
Challenges
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15. INTRODUCTION
Through a question asked in ICT Forum in Kigali last year, How can people in the village can have access to the Mobile systems, A commitment came to make a research for a solution, hence the SMS Exchange System.
As these people are having cash, the key prayer was to find an exchange object, which should so popular to that be accessed by every mobile user.
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16. That exchange point is mobile Credits:
INTRODUCTION (CONT.)
That exchange point is mobile Credits:
the mobile penetration is 42% (4,508,666) of the whole population, ie each household has almost two mobile phones.
This penetration also has a great impact of Credits availability (almost at each door)
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17. 12/8/2018

18. The system is in the process of being patented
SMS EXCHANGE STATUS
The system is in the process of being patented
It also being implemented in one of Mobile Operators in Rwanda (MTN Rwanda)
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19. It is connected directly to the Intelligence Network (Billing system);
FUNCTIONALITY
The system is a USSD Application and Value- Added Service (VAS) to Mobile Network;
It is connected directly to the Intelligence Network (Billing system);
It uses the credits a mobile user has in his phone to buy/pay some services.
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20. FUNCTIONALITY (Cont.) USE CASE DIAGRAM
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21. FUNCTIONALITY (Cont.) DATA FLOW DIAGRAM
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22. COMPARISON Mobile Banking (Banks) Mobile Money (Telecom) SMS Exchange
Users
Only bank customers re glistered for it
Only Mobile subscribers registered for it.
All Mobile users
Prerequisites
To be registered and activated for this service
To have deposit
To be registered for this service
To have Deposit
To have units on the mobile number
Sources of Funds
Deposits
The units on mobile phone
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23. COMPARISON (CONT.) Mobile Banking (Banks) Mobile Money (Telecom)
SMS Exchange
Observations
Limited to specific bank customers registered for this service
The Activation period takes time
Registration may be tiresome for some users
Deposit takes time (queue) and may involve third party costs (like transport)
Limited to specific mobile subscribers registered for this service
Registration may be tiresome for some subscribers
Deposit may take time (queue) and may times involve third party costs (like transport)
Easy to get airtime vouchers ( they are available almost in whole country as well as the mobile network coverage)
Only services charge (for USSD session)
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24. ADVANTAGEOUS Environmental impact Economic hardship applicable
Social Impact
The system is economically and environmentally successful because it is paperless.
The system is very cost effective because the mobile communication sector is very competitive and it will save all the third party costs (like transport)
The fact that the system is environmental and economical efficient, automatically, its social impact is remarkable.
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25. It has not been easy to convince:
CHALLENGES
The system requires many interconnections of different players' System (Operators, Utility Providers),
It requires also an important budget (for financial reconciliation at a period)
It has not been easy to convince:
It’s new (always this question: Show where else it has been implemented??)
A big WORRY: It is touching the “HEART” (billing system).
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26. CONCLUSIONS & RECOMMENDATIONS
To Telecom (especially in developing country):
To promote such systems as they can help a lot of people (especially in remote areas)
To Government & ICT Regulators:
To promote the spirit of research so that many innovations should come up and ICT continue to go beyond core communication (Voice, SMS and Internet) but also impact the whole life even to people in the heart of villages
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27. CONCLUSIONS & RECOMMENDATIONS (Cont.)
To ITU: to continue such workshops to help an innovation in one place to spread an to every one as the globe has become one home.
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28. Merci!
Thank You!
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