In the future, people will be able to send, receive, and use money anytime, anywhere, with anyone. . . instantly.
Unfortunately, the world runs on private payment systems.
Despite the abundance of modern payment solutions, these rarely have the ability to interoperate, or “talk” to one another. This disconnect is where the inherent costs of the financial system exist (e.g. transaction fees, wiring fees, processing fees, hardware fees).
Meet Winnie, a shopkeeper who pays the price.
For her, accepting digital money is impractical for multiple reasons. She can’t afford the setup costs that come with each new service or the transaction fees charged on each sale.
Because her livelihood depends on her day-to-day income, it isn’t an option to wait days for her money to settle in her account.
We call this the merchant problem.
She can’t accept all
forms of payment.
Winnie’s bank doesn’t interoperate with her customers’ banking and payment systems. Most modern digital services only work between users on the same payment network. So, she only accepts cash.
She can’t afford transaction costs.
Start with ultra thin margins on the wears she sells. Subtract costs and transaction fees imposed by modern digital payment services. She can’t afford to stay in business.
This hurts Winnie’s business, stifles economic growth, and excludes people from the financial system.
The merchant problem is one of many that individuals face due to the inability of payment and financial systems to interoperate with one another.
There is a solution:
Real-Time Payment Networks
Integrate financial systems with an interoperable, real-time payment network (RTPN). This is a multi-actor, instant, 24/7 electronic fund transfer service that can be initiated through a variety of channels.
How does an RTPN drive value?
LOWER TRANSACTION COSTS
SYSTEM WIDE TRANSPARENCY
Mojaloop is a real-time payment network platform developed in partnership with the Bill & Melinda Gates Foundation.
ModusBox has lead multiple Mojaloop implementations in developing markets.
Key design principles of Mojaloop
Open-loop system available to all
Available to any licensed financial institution in a country.
Enables low value, high volume transactions in real-time.
Governed by financial service providers, regulated by the Central Bank
Creates fairness within the financial system participants with a well-tested model
Our work with Mojaloop
We have deep roots working across financial services, mobile money, and development and delivery of flexible micro-services. Our history and experience enabled us to partner with other industry leaders in the creation of Mojaloop in order to drive financial inclusion to the world’s most vulnerable.