MTN is valuing its mobile-money arm at about $5 billion, joining African wireless carriers planning to list these businesses in a region that has more mobile-money accounts than anywhere else in the world.<\/p>\n
MTN\u2019s valuation of its unit follows Mastercard and TPG Holdings investing $300 million in Airtel Africa\u2019s mobile-money business at a $2.65 billion value.<\/p>\n
\u201cWith similar valuations to that of Airtel, our valuation would sit at R75 billion, or about $5 billion,\u201d said MTN chief executive officer Ralph Mupita.<\/p>\n
\u201cNo decision has been made as yet, but listing will be an option considered if that will be the best approach to unlock value.\u201d<\/p>\n
Johannesburg-listed MTN has previously said it was looking to spin off\u00a0its fintech business.<\/p>\n
Mobile money, where users store and manage cash in an account linked to a mobile phone, is one of the fastest-growing sources of income for wireless network operators like MTN and Vodafone Group.<\/p>\n
Sub-Saharan Africa, which struggles with limited banking infrastructure, has more mobile-money accounts than anywhere else in the world, with about 548 million at the end of 2020, or 54% of all customers, according to the GSMA, the global mobile-operator industry group.<\/p>\n
Part-owned by a unit of\u00a0Vodafone,\u00a0Safaricom is the largest mobile-money provider in the region with 27 million people that use M-pesa as a mobile bank — buying groceries, borrowing money, transferring cash.<\/p>\n
While the region now boasts $490 billion in transaction values, according to GSMA, there\u2019s still a lot of untapped potential, with two of its most populous regions Nigeria and Ethiopia yet to roll out of the service.<\/p>\n
South Africa\u2019s MTN and its counterpart Safaricom are planning to bid for an Ethiopian operating license, although it\u2019s uncertain that mobile-money services could be rolled out with the initial licenses in the country.<\/p>\n
Similarly, Nigeria has been a laggard in rolling out mobile-money services, providing some provisional licenses.<\/p>\n
Last week, banks in Nigeria cut off MTN from payment platforms during a negotiation process where the mobile operator wanted to lower commissions costs on transactions.<\/p>\n
MTN\u2019s valuation was reported earlier by the Financial Times.<\/p>\n