A decade of financial innovation in Africa · A decade of financial innovation in Africa Press kit...

Orange Money - September 2018 1

A decade of financial innovation in AfricaPress kitSeptember 2018

02 Orange Money - September 2018

Content & layout: www.lmae.fr

Overview

04 How mobile money changed Africa

06 Orange Money, how does it work?

08 Looking back at 10 years of success

10 Orange Money today

12 An increasingly digital experience

14 A large ecosystem of partners

16 A regulated activity

18 A distribution network driving success

20 Orange Money, the service of entrepreneurs

22 What next?

The story of a revolution of uses

territories through partnerships, simplified procedures and job creation. Thanks to dematerialized money transactions, Orange Money is contributing to Orange’s ambition to be a partner in the digital transformation of the African continent. This dynamic continues with the increasing use of the smartphone and the uses it brings. By becoming an essential financial service in the daily lives of millions of customers, Orange Money has done more than meet the challenge of diversifying the Group’s activities: this service is the precursor of an ambitious project to transform Orange into a multi-service digital operator.

Ten years ago, Orange launched a product emblematic of a trend which has transformed the African economy: mobile money. With an electronic wallet offering several mobile financial services, Orange Money is about financial inclusion for millions of people who have little access to banking services but who almost all possess mobile phones. A service that gives the average person the same instant access, security and traceability of transactions, as for businesses, governments and administrations. A player who leaves a positive footprint in the



Even today, access to banking remains difficult for the majority of people in African countries. The factors are manifold: conditions to open an account, high recurring costs and the scarcity of agencies help to limit the region’s banking rate. In most emerging countries, cash continues to be the most widely used payment method.

Mobile phones have become an essential part of everyday life, where long distances and lack of investment prevent the proper development of landline telecom infrastructures. In addition to mastering mobile

technology, a digital operator like Orange also harnesses technical platforms that convert cash into traceable, secure and controlled electronic money. It is on this combination that mobile money services are based, offering a major lever for the development of companies, the economy and society in Africa.

Mobile money promotes the financial and societal inclusion of the most vulnerable and under-resourced people, such as rural populations or women. It is estimated that 70% of people live outside urban areas, where the lack of banking infrastructure makes mobile money the best alternative to cash and informal financial management. Studies have shown the positive impact of mobile money on women’s empowerment and support for the development of women’s entrepreneurship.

How mobile moneychanged Africa

x 4.5

x 9 x 12 2012 2012 2017

Sources: GSMA, State of the Industry Report on Mobile Money (2017) and GSMA, Mobile Money for the unbanked (2012)

75 million

128 million

US$ 1,6 billion

338million

US$ 19,9billion


Mobile money figuresin sub-Saharan Africa

2017

1.2billion

Number of customers

Number of transactions

Value of transactions

2012 2017


Orange Money is an electronic wallet linked to an Orange mobile number. It simply converts cash into electronic money, and vice versa.

Orange Money,how does it work?

Transfers and payments

There are three types of transaction possible with Orange Money:

■ Money transfer: Orange Money makes it possible to send money via mobile phone to any Orange Money customer within the same country and internationally for certain countries.

■ Payment: users can make payments to merchants, pay some bills remotely (energy, tax, university fees, telephone etc.), make purchases on the web or top up airtime whenever they want.

■ Financial services: in Madagascar, customers can now access m-kaji, PAMF’s instant credit and savings service from their Orange Money mobile account. Orange will gradually extend this type of solution to other countries.

Registration

The Orange Money service is available toall Orange customers provided they have a SIM card, a mobile phone and an identity card. Registration is free at all Orange Money points of sale.

Deposits and withdrawals

To load their account, the customer goes to a point of sale with the desired amount in cash. Following the transaction, the seller and the customer receive an SMS confirmation of the transaction’s success. The account is instantly credited. Withdrawing cash is just as easy once the customer has entered their PIN.


A secure service with reduced fees

Customer’s electronic money is protected by a secret code and all transfers are secure. For a reduced fee, customers avoid handling cash that requires time and energy with potential security problems.

Technology

The Orange Money service uses USSD technology, very similar to the systems used for sending SMS and compatible with 99% of mobile phones. Performed via the GSM network, transactions are secure and work 24/7. To make a transfer, simply dial a #144# type short code and follow the menus. On Smartphone, customers can use the Orange Money app, which further simplifies the service.

w

Originally, a solution to the urgent needs of customers without access to banking services

■ I transfer money to my relatives.

■ I top up my airtime.

Building on its success, Orange Money has extended its services*…

■ I pay my bills.

■ I withdraw money from the ATM with my mobile.

■ I pay for my purchases** in shops, on the market or on e-commerce sites.

■ I have an Orange Money Visa card.

■ I transfer money to my relatives abroad.

… to bank customers*…

■ I transfer between my bank account and my Orange Money mobile account.

... as well as companies and administrations…

■ I pay my employees.

■ I pay my suppliers.

■ I pay my taxes and tax stamps.

■ I pay my children’s school fees.

… while also distributing micro-credit and savings solutions* with a financial partner

■ I can take out a loan or set up savings directly from my mobile without having to go to an agency.

*availability by country

** at partner merchants and websites

08 Orange Money - Avril 201808 Orange Money - September 2018

2008 2009 2010 2011 2012

2008-2012 Laying the foundations Orange Money’s launch in Côte d’Ivoire was the Group’s first initiative in terms of mobile money in Africa. The objective was to lay the foundations of what would become the flagship for diversifying Orange’s activities, focusing on the core services of money transfer and telephone credit purchase. The activity very quickly revealed its potential and was replicated in Mali, Madagascar, Senegal and other countries, in close collaboration between the Orange Group and its subsidiaries.

End 2012, Orange Money is available in 9 countries. With 6 million customers and 9 000 sales points, the model has proved itself to be robust.

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Looking back at 10 years of success

Orange Money - Avril 2018 09Orange Money - September 2018 09

2013 2014 2015 2016 20182017

2013-2015 Orange Money became popularFrom 2013, Orange Money expanded its network of points of sale gaining more access to individuals and experiencing a true acceleration in the number of customers. Transfers between different countries were being developed at the same time. By creating regional corridors, Orange Money stood out as a pioneer and was now recognised as one of the leaders by the industry. The priority within countries was to support the distribution network and the multiplication of partnerships: energy suppliers, governments, etc. Orange Money had become more than just a transfer service.

At the end of 2015, Orange Money had reached nearly 16 million customers and 42,000 points of sale: growth was clearly accelerating!

2016-2018 New status and digitisationOrange Money turned a new corner in 2016 by becoming its own electronic money institution (EMI) in four countries, to which three other countries were added in 2017. The Group was now in direct contact with the central banks; the authorities in charge of regulating this activity. At the same time, Orange continued to partner with banks to expand its range of services and become a player in mobile financial services. Another turning point was digitisation with the introduction of the Orange Money API and the launch in Côte d’Ivoire of a new version of the Orange Money application that would gradually be extended to other countries.

In September 2018, Orange Money had attracted 40 million customers (of which 13 million were monthly users) and had 160,000 points of sale. Orange Money had reached a maturity point and launched ambitious development programs: it was time to conquer new service areas.

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Orange Money,todayIn ten years, Orange Money has grown and attracted millions of customers throughout West Africa and the Middle East. Some key figures at the end of 2017.

17 countries* 1.25 billion

transactions

40 million customers, of whom 13 million are monthly users (september 2018)

160,000 points of sale

26 billion eurosin transactions including 500 million in international transfers

* Including in Mauritius under the brand my.t mobile money

,

MaliJune 2010

Côte d’IvoireDecember 2008

Guinea BissauDecember 2016

Sierra-LeoneJuly 2016

LiberiaApril 2016

Democratic Republic of CongoSeptember 2012

MadagascarSeptember 2010Botswana

August 2011

RepublicCentralApril 2016

MauritiusAvril 2012

SenegalMay 2010

GuineaDecember 2016

NigerJune 2010

EgyptSeptember 2013

Tunisia June 2014

Burkina FasoJune 2016

CameroonSeptember 2011


An increasingly digital experience

Available since 2015 in most countries, the Orange Money smartphone app provides access to the service through a more intuitive interface than the USSD menu. Furthermore, new features are constantly added, for example with the upcoming integration of a more accessible interface for users with reading and writing difficulties.

Communication and financial transactions: a natural combination

The uses of Orange Money have demonstrated: it is essential for the initiator and the beneficiary of a money transfer to enter into a relationship, so they can confirm their transaction. That’s why a new version of the Orange Money app, launched in Côte d’Ivoire in 2017, makes it

possible to call and text via SMS without leaving the application. In the future this will include a chat service with a display of the transaction history with an individual, for a continuous exchange between users.

Orange Money at your fingertips ... and your voice

Numerous developments are being integrated: easy access to account information while respecting confidentiality and transaction security (with for instance fingerprint authentication or facial recognition) and easy access thanks to the geo-tracking of Orange Money points of sale, etc. In addition, transfers from the Orange Money app can now be ordered by voice with the iPhone voice assistant, Siri.

Although their penetration rate is still low in Africa (from 20 to 30% depending on the country), the smartphone and its uses are developing rapidly, and Orange Money services are evolving to support this trend.


Introducing the APIs!

Two years ago, Orange introduced its application programminginterfaces (APIs) for merchants accepting Orange Money as a payment method. As such, Orange Money facilitates the development of e-commerce in Africa through the integration of its web payment services. In the coming months, smartphone payments will also be available on mobile applications. To speed up the availability of Orange Money from a customer bank account, Orange Money has also extended its API program to all banks via the «bank to wallet» service. The Orange Money APIs are available on the Orange Partner portal. A development and test environment is provided to companies wishing to integrate our payment system on their site or in their application, thus extending Orange Money’s presence. By providing technical support facilitating the integration of a payment system, the open ecosystem of Orange Money promotes the emergence of African start-ups and SMEs.


A large ecosystemof partners

Over the years, the offer has expanded with the arrival of partners who saw in Orange Money the opportunity to simplify the lives of their customers and administrators, in countries where cash payments cause considerable loss in terms of time and transportation costs.

These partners are now an integral part of Orange Money’s success and contribute to its ambition to become a universal payment method.

Facilitate all payments

Water and electricity suppliers were some of Orange Money’s first partners. Today, the service is interconnected with most of them, along with television packages such as Canal+. The introduction of the Orange Money API means that any company wishing to add the payment system on its website can become a partner of the service. For example, Orange has invested in Jumia, a major e-commerce group on the African

continent. Customers can now pay on their site with Orange Money in Senegal, Côte d’Ivoire and Cameroon.

Partner of governments and administrations

Orange Money is a partner in the digital transformation of states: institutions and administrations early realised Orange Money’s potential to improve the efficiency and recovery of payments to citizens: taxes and fees, tuition fees, etc. Mobile money helps to improve tax revenues, and thus contributes to funding public infrastructures. Established since 2011 in Côte d’Ivoire, tuition payment via Orange Money means 1 million registrations a year, reducing not only cash management expenses but also the associated risks. At the end of 2015, the Ministry of Education in Guinea

digitized the enrolment procedure for high school graduates in post-baccalaureate programmes and introduced the payment of orientation fees with mobile money: more than 85% of payments on the website were made via Orange Money. In 2018, Orange Burkina Faso signed a partnership with the Ministry of Health to pay the salaries of community-based health

workers (CBHA) via Orange Money. CBHAs are key actors in the health system in Burkina Faso, and contribute to the fight against malnutrition. This latest innovation meets the needs of accessibility, security and time saving related to the payments of these agents. Currently, more than 16,000 of CBHAs receive their salaries through Orange Money as part of this partnership.

Collections and payments

While Orange Money provides players with an effective way to collect taxes, fees or royalties, it may also be used to give funds. For companies as for administrations, the disbursement of salaries, pensions, grants or scholarships is facilitated. During the Ebola crisis in Sierra Leone, Orange Money was used by NGOs to pay for their agents’ field missions.


A regulated activity

In recent years, central banks have issued instructions and guidelines updating the regulation of mobile money

To comply with this framework, Orange obtained an Electronic Money Institution (EMI) authorisation in 2016 for Côte d’Ivoire, Mali, Guinea, Senegal and, in 2017, for the Democratic Republic of Congo, Burkina Faso, as well as mobile money authorisation in Sierra Leone. Each Electronic Money Institution, approved by the country’s central bank, is a full-fledged company and subsidiary of the local telecom operator. It submits requests to the central bank for launching new features and provides activity reports.

It is responsible for issuing, managing and distributing electronic money. In other countries, the service is backed by a partner bank that issues electronic money..

Shared compliance expertise

Created in September 2016 and based in Abidjan, Côte d’Ivoire, the Orange Money Compliance Expertise Center (or CECOM, in French) provides, on behalf of EMIs, first-level processing in combating the financing of terrorism and money laundering (analysis of customer databases and transactions) and provides support in the various areas of banking compliance. Second level processing is carried out by the Orange EMIs.

Electronic Money Institution (EMI)

And what about the banks in all this?

Although Orange Money has gained independence by becoming an electronic money institution in 7 countries, the Group is also strengthening its partnerships with banks:

■ For distribution: Banks are part of Orange Money’s point of sale network.

■ To expand its offer: by providing joint customers with the option to make transfers between their Orange Money

account and their bank account. The banks are gaining a tremendous extension of their network, and the system is very useful to Orange Money partners or distributors who can transfer the electronic money collected directly to their bank account.

■ For the development of new financial services: in Madagascar, Orange Money customers can access a micro-credit and savings offer developed by PAMF. Orange intends to extend this type of service to other countries.


With 160,000 points of sale in 17 countries, Orange Money has built a strong network in urban areas, where economic activity and population are concentrated, as in rural areas, where there are important agricultural and mining activities.

What does an Orange Money point of sale look like?

Orange Money points of sale are very diverse in nature. The Orange shops and franchises represent only a small part. Indeed, 95% of distribution is based on other structures, including networks of gas stations or banks, supermarket chains and many independent businesses for which Orange Money represents an additional activity: grocery stores, hairdressers, pharmacies etc. Not to mention the Orange Money kiosks dedicated to the service. In Guinea, for example, there are more than 3,000 Orange Money kiosks and as many jobs created.

A distribution network driving success

The physical network is a fundamental part of Orange Money’s development. Customers must go to a point of sale if they want to register, replenish their account or withdraw money. The trust that users place in the service also lies in its ability to fulfil a strong promise: the ability to access their money wherever they are in the country.

Orange Money - Avril 2018 19Orange Money - September 2018 19

Orange Money,the servicefor entrepreneurs

Orange Money quickly emerged as a significiant driver of growth for local businesses and entrepreneurs. A few success stories.

No need to travel to order a part

Ibrahim from Abobo scrapyard in Côte d’Ivoire. To meet customer demand, Ibrahim purchases spare parts in the surrounding countries: he responds to specific orders for used parts. With Orange Money, Ibrahim’s customers no longer need to travel to the scrapyard to order. They send payment to his phone and place their order at the same time. Ibrahim therefore has more funds to go in search of spare parts for his customers.


A full order book for two months

Korotomou, a Bogolan cloth seller in Côte d’Ivoire.

Originally from Mali, this hand-crafted fabric is very popular in Côte d’Ivoire. The merchant had to undertake long journeys between the two countries to get supplies meaning it was difficult to fulfil all orders in due time. In September 2013, Orange Money opened intraregional transfers between several West African countries, including Côte d’Ivoire and Mali. Korotomou’s business has been transformed: she can now pay her suppliers remotely and receive deliveries without having to travel, which shortens the time and improves the availability of her products. In December, in the run up to Christmas and just months after the launch of this offer by Orange Money, the merchant received so many requests that her order book was full for the subsequent two months.


■ Offer savings and credit products from partners, previously reserved for banking customers only. These new services are currently being launched in Madagascar, in partnership with PAMF, and allow users to subscribe directly on their phone. Orange Money intends to deploy these offers in other countries.

■ Develop interoperability for transfers and payments, working with other mobile money operators to allow Orange Money customers to make transfers to a user regardless of their carrier. International transfers will also continue to be deployed across the continent.

■ Accelerate digital development to support the penetration rate of the smartphone throughout Africa. The new application, including conversational capabilities, will soon be deployed in all countries with additional new features. API development will be strengthened to make Orange Money an ecosystem open to new partners.

■ Develop the offer for professionals, companies and administrations, because many people use Orange Money as part of their professional activity. Craftsmen, tradesmen, SMEs and companies of all sizes: expectations are high and requirements are real in terms of collection, payment of suppliers or of employees. A specific offer will be dedicated to these professionals. Similarly, partnerships that allow administrations and other institutions to collect or pay in bulk will be further strengthened.

■ Accelerate the development of insurance: getting insurance adapted to the needs with an increasinely digital model will also be a key focus for Orange Money, with the aim of deploying insurance services to a large population in Africa.

■ Accelerate conversion to comply with regulatory requirements. Orange intends to continue its efforts in the field by continuing to acquire the skills and tools that allow large-scale deployment of solutions that comply with the sector’s regulatory obligations.

In ten years, Orange Money has become one of the world leaders in mobile money. In the next five to ten years, its ambition is to make mobile money an essential payment method and become a leading player in mobile financial services in Africa and the Middle East, including savings, credit and insurance.

Orange’s plans to prepare for the future:

What next?


Orange’s financial services

Orange Bank vs. Orange MoneyTwo markets, two business models

Orange Bank – A public limited company capitalised at €297,575,712 – 67 rue Robespierre – 93107 Montreuil Cedex – 572 043 800 RCS Bobigny – Orias n°07 006 369 (www.orias.fr). Orange is entitled to market Orange Bank banking products and services in its capacity as sole agent for banking transactions and payment services. Orange – a public limited company capitalised at €10,640,226,396 – 78 rue Olivier de Serres – 75015 Paris – 380 129 866 RCS Paris – Orias n°13 001 387.

A bank resulting from Orange’s acquisition of a 65% stake in Groupama Banque in October 2016. Orange Bank has a banking licence.

Orange Bank was launched in France and will expand in Europe, primarily in Spain and Belgium.

Personal banking services designed for mobile phones

■ Bank account with: - mobile payment,- configurable credit card (secret code, lock/unlock, ceilings),- check book on request

■ Savings account■ Personal loan

■ Bank access via smartphone■ Innovative features: send money by SMS, check your balance

in real time, temporarily block and unblock your card■ A virtual advisor accessible 24 hours a day, 7 days a week, 1st point of contact

for all customers

Model

Footprint

Product range

Strengths


Based on its core connectivity business, Orange develops growth-generating services that enhance its customers’ experience. For instance, the Group is a pioneer in the field of mobile financial services, in Europe as well as in Africa and the Middle East.

Orange Bank vs. Orange MoneyTwo markets, two business models

A mobile money operator, since 2008, which distributes offers from banking partners and has obtained the status of Electronic Money Institution in 6 countries (Côte d’Ivoire, Guinea, Senegal, Mali, Democratic Republic of Congo, Burkina Faso) and a mobile money license in Sierra Leone. Financial services distribution or production projects are regulated by local Central Banks, notably by BCEAO in West Africa.

Orange Money is available in 17 countries in Africa and the Middle East, and also in Romania.In addition, international transfer is offered in some countries for diasporas.

■ A universal wallet accessible from any type of mobile phone to send money without a bank account, pay college tuition, receive salary, etc.

■ Strong distribution network with 160,000 sale points

■ Numerous partnerships for increasingly broad uses, including with financial institutions in order to develop access to mobile financial services.

A mobile electronic money account for individuals and professionals■ Money transfer, mobile air time top up■ Bill payment, merchant payment and web payment■ Payment of suppliers and salaries for professional purposes■ Payment of university fees, collection of taxes■ Micro credit and savings in Madagascar and Mali in partnership with PAMF

Model

Footprint

Product range

Strengths


About Orange

Orange is one of the world’s leading telecommunications operators with sales of 41 billion euros in 2017 and 150,000 employees worldwide at 31 March 2018, including 91,000 employees in France. The Group has a total customer base of 263 million customers worldwide at 31 March 2018, including 202 million mobile customers and 20 million fixed broadband customers. The Group is present in 28 countries. Orange is also a leading provider of global IT and telecommunication services to multinational companies, under the brand Orange Business Services. In March 2015, the Group presented its new strategic plan “Essentials2020” which places customer experience at the heart of its strategy with the aim of allowing them to benefit fully from the digital universe and the power of its new generation networks.

Orange is listed on Euronext Paris (symbol ORA) and on the New York Stock Ex-change (symbol ORAN).

For more information on the internet and on your mobile: www.orange.com, www.orange-business.com or to follow us on Twitter: @orangegrouppr.

Media contacts: 01 44 44 93 93

Tom Wright:[email protected]

Nathalie Chevrier: [email protected]

A decade of financial innovation in Africa · A decade of financial innovation in Africa Press kit...

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