I have to admit when I first read about Mowaly I was not completely convinced.
I really don’t see myself throwing away my wallet and using my cellphone to transact, especially when participating merchants are still fairly limited. But then I realised I am not the target market.
The concept of Mowaly — a virtual wallet that holds virtual currency called ‘mimoney” — is aimed at younger people who do not have credit cards or debit cards. These consumers are a key market for retailers, such as movie houses and music stores.
By using the virtual currency, mimoney, people can buy books, music, top up airtime and book movie tickets online, all without having to open a bank account.
Another key function of Mowaly is that it allows for the cost-effective transfer of money.
Parents can top up their children’s Mowaly account or a family member working in Johannesburg can — at the cost of 35c — transfer mimoney to a person living in Limpopo, for example.
Participating retailers are limited at the moment and because you cannot cash in mimoney for real money, it may limit the benefit of transferring money back home.
Participating retailers include Ster-Kinekor, Kalahari.net and Mr Delivery. You can also buy airtime and download ringtones from eXact-Music or eXactmobile.
John Campbell of Beyond Payments, the technology company behind Mowaly, says a large food retailer is expected to join soon. The fact that merchant transactions are free, compared with the R2 to R4 you pay to use your debit card at a merchant, may also bring in other customers over time.
Although this product will take time to penetrate the wider market, targeting the youth and getting them to use cellphones as a way to purchase goods is preparing for the future when we may just see our cellphones replace our wallets.
In Asia there are already cellphones with embedded chips, similar to those in pin cards, which allow purchasing transactions.
How it works
Mimoney is a virtual currency. Of course, you have to have money to start with, but you can load the mimoney currency on to your cellphone and redeem it for goods and services.
You access Mowaly through your cellphone browser or, alternatively, if your phone supports downloads, you are able to download the application.
So, for example, you would load R500 of mimoney on to your cellphone in much the same way as airtime. You can do this through an ATM if you are a Standard Bank customer or through online banking by having Mowaly as a beneficiary.
Alternatively, someone can transfer mimoney to your account or you can purchase mimoney through participating retailers.
You would then go to participating stores, such as Ster-Kinekor, select Pay Now on your browser and a mimoney number (micode) is generated for the value of the desired purchase. The number is valid for only 20 minutes and can be used for only one transaction.
You give the merchant the number or type it in on the website as you would your credit card number.
With Mowaly you don’t have to have a bank account and, because registration is by a cellphone, there is no need to fill in any paperwork. This alleviates the often tedious processes that applying for credit cards or debit cards entail.
To comply with money-laundering legislation, there is a R25 000 maximum balance allowed on the account and spending is limited to R5 000 a day.
Standard Bank is the bank behind the product and all money is held in a trust to ensure that if anything goes wrong you will still be able to get your real money back.