This is a country assessment report on Malawi developed as independent Mobile Money Consultant. The report provides market assessment and identifies possible opportunity pockets for impact investors and donors

1. Syed Mohsin Termezy
Mar 29 , 2014
Digital Financial Services
Malawi
Doc # JSBL.SO20140223.CXO
Mohsin Termezy, Syed
Director
Harappa Impact Investments
Doc# OAR20140329-MS
Opportunity Assessment Report

2. 2
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3. 3
Agenda
- Country Landscape – Malawi
- Opportunity Areas and Assessment
- Recommendations
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4. 4
Country Landscape - Malawi
Country Stats
Population – 15MM
Banked – 19%
Tele Density – 26%
Key Challenges
Health- AIDS
Grid Electricity
Electoral Reforms
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Banking
Banks – 11
Regulator - Progressive
Bank Association - Strong
Payments Vision - Defined
Payments Strategy - Defined
National Payment Council ++
Telcos
Landscape- Competitive
ARPU – Low
Phone Charging – Challenge
Mobile Money
Airtel Money- Leader
TNM - Follower
Payment Tech
Elect Chq Clearing – 9 Banks
RTGSS /MITASS - Yes
Switches – 1 (Mal Switch)
ATM Interop- 4 Banks
POS Interop – 4 Banks
Settlement- VisaNet

5. 5
Opportunity Areas & Assessment
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Payment Tech / Banks/ NSwitch
- National Switch competing MalSwitch
World Bank 5 Year Loan (FSTAP)– $28.2MM
Local switching and settlement of Local Cards (D/C)
Minimize reliance on VisaNet to only Foreign cards
- ATM & POS acquiring and settlement framework
- Local Switch certification framework for Issuers
Regulator RBM | Electoral
Management System (GoM)
- 5 year Payment System Vision (‘13- ‘18) &
impact assessment (‘09-’13)
- Capacity assessment for microloans for solar
power (Access to finance Agenda)
- Infrastructure for KYC of customer using
(voice)biometric technology
- Unified identity Program for G2P programs and
m-voting platforms
Mobile Operators
- Carded Wallets improving
margins on G2P cash-outs (70% of
Airtel Rev)
- Joint Telco Branded Agent
Network with POS Channel
(Tower sharing happening
already)
- POS connected to National
Payment Switch generating off-us
acquiring revenue from bank
issued Credit/Debit Plastics with
favorable Interchange
- Possible inclusion of ESCOM in
consortium for community energy
services and power up POS
devices
- PrePaid Electricity using
Mwallets possibly against loan for
solar home systems

6. 6
Recommendations
Opportunity
‘ATTRACTIVE’
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Timings
 Re-assesment – June
2014
(Elections Due May/14)-
Current president expected
for re-election
 Regulatory Governor-
Re-election preferred
 Insights into new 5 year
payment vision
 Future roadmap of NPS
Entry Decision – July ‘14
Strategy
1. Low Risk- Organic
- Secure an anchor client
preferably Airtel with
retainer revenue (Carded
Wallet)
- Bilateral relationship
with South Africa
Wallets for International
remittance Interop
2. Medium Risk- Big Bang
- White Label Agent
Network Operator
backed by South-African
Investor & Multilateral
Donor
- Independent Interchange
Scheme setup

7. 7
Execution Roadmap available upon
Commercial Contracting
Please Contact
Mohsin Termezy, Syed
HARAPPA IMPACT INVESTMENTS
+92300 8235 898
Mohsin.Termezy@gmail.com
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