MTN Nigeria, grappling with sluggish adoption of its MoMo Payment Service Bank (PSB), is deploying targeted voice calls to reactivate dormant users, signaling a strategic pivot to shore up its mobile money venture. This move comes as the telecom giant contends with the lingering effects of a substantial 2022 system glitch and a sharp decline in active MoMo wallets.
Customers who received calls told Condia that the company is using personalised, 5-10-minute voice calls from a three-digit number to urge past users to re-engage with the platform and rate their experience. This low-cost customer acquisition strategy follows a restructuring of MoMo’s sales incentives, aimed at optimising monetization and reducing acquisition expenses.
The push is necessitated by a 46.6% year-over-year drop in active MoMo wallets, falling to 2.8 million by the end of 2024. This decline underscores the challenges MTN faces in penetrating Nigeria’s well-established financial services market, which contrasts sharply with East African models where telecom-driven mobile money dominates.
Financial disclosures reveal significant investments despite the user slump. MTN increased its MoMo staff by 18 in 2024, bringing total headcount to 103. Capital injections into MoMo Payment Service Limited surged to ₦46.35 billion, including ₦30 billion in Q4 alone, up from ₦25.2 billion in 2023. This investment includes the acquisition of a non-controlling interest. However, customer deposits halved to ₦3.8 billion, down from ₦7.6 billion in 2023, reflecting user hesitancy.
The 2022 system glitch, which resulted in approximately ₦22 billion in unauthorized transfers, continues to weigh on the venture. While ₦12.5 billion has been recovered, MTN will absorb the remaining ₦9.5 billion under a shared services cost agreement.
Analysts suggest that Nigeria’s mature banking sector, with its robust payment infrastructure, poses a significant hurdle for telecom-led mobile money services. Unlike markets where telcos are the primary financial service providers, Nigeria’s landscape features a distinct separation between telecom and financial sectors.
MTN declined to comment on its specific strategies, but the voice call initiative and continued investment highlight the company’s commitment to establishing a foothold in Nigeria’s burgeoning mobile money market, despite facing significant headwinds.
