The Reserve Bank of Malawi (RBM) has rubbished claims that t it is impeding ecommerce by imposing high connection fees that keep FinTech operators out of the digital finance system.
At a recent round table discussion on tech and social entrepreneurship in Malawi, organised by British Council and mHub, it was suggested that local ecommerce growth is being thwarted by failure of FinTech to connect to the country's national payment system or National Switch Centre (Natswitch).
The cost of doing so is a minimum fee pegged at MK50-million (approximately R980,678).
Spokesperson for RBM Mbane Ngwira disputed the assertion. "We only have commercial banks, mobile money operators and mfi hub as participants on the National Switch, who also happen to be shareholders. The new participants are required to pay US$50 000 in Malawi Kwacha equivalent," he said.
Role of RBM
Ngwira added that no Fintech has come forth or shown interest to integrate with Natswitch. "The country has not yet started discussing participation of FinTech on the National Switch because FinTech has never engaged National Switch."
Ngwira said the role of RBM is only to ensure that all switching activities are done according to internationally accepted standards and principles.
Takondwa Makawa of events app Phwando said RBM, as the financial regulator of the switch, demands too much from FinTechs wanting to connect.
"This hinders the growth of e-commerce in the country," he said. "By having the Bankers Association of Malawi run the national payments switch, other players wanting to join are viewed as competition."
President of the ICT Association of Malawi, Bram Fudzulani, also representing FinTech software developer Angle Dimensions, said it actually costs more than the K50-million, but that the regulator is flexible with small operators.
Fudzulani suggested that start-ups work through financial organisations like banks that are already using the platform.
"Angle Dimension has access to the national switch through a bank but they had to offer them value for the deal to work," he said before he advised his colleagues. "Show them you will add to their bottom line."
Ngwira said the fees mentioned might be the minimum capital requirement that the central banks set whenever a company wants to roll out a payment service and they do require proof of K50-million capital.
"This is meant to ensure that when they start handling customer's money and in case of anything, at least we are sure that customers' funds are safe and they can be compensated otherwise granting authorisation anyhow may put customers' funds at risk of loss," he said.