Customer Makes Mobile Money Mistake, Telco Pays

The Uganda Communications Commission (UCC) has said that it is setting up a committee to investigate MTN Uganda after complaints on social media about MTN’s mobile money policies. Reuters reports that:

…dozens of MTN’s subscribers in Uganda took to Twitter to accuse it of making it nearly impossible to cancel a mobile money transaction made in error.

This occurred after a university lecturer tweeted that he had made a mistake while trying to send money to a friend for funeral expenses upon which he was told he needed a court order to claim the money from the recipient.

A spokeswoman for MTN Uganda said the company had internal policies for money sent in error. So long as the money had not been withdrawn at the other end, cash could be frozen after a subscriber [informs MTN of] an erroneous transaction. Then after some checks it could be returned.

To be fair, this is not purely an MTN issue. This type of thing happens all the time on mobile money platforms. A customer sends money to number Y, intending to send to number X. He realises the mistake (e.g. from the SMS confirmation that comes after the transaction has gone through).

Now it is a race against time. The customer must get through to the telco’s customer care line, state his problem and get the transaction reversed before the owner of number Y withdraws the funds. There is, of course, the possibility that Mr Y is a good guy and decides to return the funds out of his own volition but this is more of an exception than the rule!

What can the telco do? Some telcos have already put in a mechanism to confirm the transaction recipient before finalizing. So when the customer is attempting to send, he would immediately see that the funds are destined to Y instead of X. At that point he can cancel the transaction and restart the transaction to the correct number. Following all the criticism, MTN also took to Twitter to advise customers to double-check the number when prompted.

It is possible to go a step further. For example, Safaricom allows the customer, upon realising his mistake, to immediately send a text to a short code (in this case 456). That automatically suspends the transaction so that the funds are not accessible by the recipient. This method has the benefit of not forcing the customer to wait at the IVR customer care line. Upon receiving the SMS request, customer care representatives follow up via phone, talking to the sender and recipient to confirm that the transaction was erroneous and then reverse the transaction where there is no dispute. Meanwhile the amount in question is held in suspense.

Can a probe of MTN Uganda resolve this problem? Highly doubtful. However it is a timely reminder to telcos that a dissatisfied customer can trigger an issue of this scale.

Joseph Nderitu
Joseph Nderitu
Joseph Nderitu is a director at Integrated Risk Services Ltd and specializes in revenue assurance. He previously worked as Head of Revenue Assurance and Fraud Management at Vodacom's operation in Tanzania, having previously served in the same role at Vodacom Mozambique.

Before his work with Vodacom, Joseph was an internal audit manager for Airtel, with responsibility that covered their 17 countries in Africa. Whilst at Airtel, Joseph led reviews of the Revenue Assurance, Customer Service and Sales & Marketing functions.

Prior to his stint at Airtel, Joseph was an RA manager at Safaricom in Kenya. He holds an MSc Degree in Information Systems.