The Reserve Bank of Malawi (RBM) has given a nod to Malcom Limited, a local ICT company, to roll out its charge card services in the country.
Malcom is expected to roll out its MobiMax charge card service, following a clearance by the central bank and the installation of point of sale (PoS) devices at retail outlets.
RBM deputy governor (economics) Naomi Ngwira in a letter addressed to Malcom dated February 12 2015 said the firm is free to roll out the MobiMax charge card service since the card cannot be classified as either a debit or credit card.
“After a thorough assessment of your application, we note that the proposed charge card cannot be classified as a debit or credit card since there is no interface with cardholder’s bank accounts or employers’ or retailers’ bank accounts.
“The transaction flow will, therefore, have no direct effect on bank accounts of all the parties involved. Hence, the proposed charge card does not fall under the scope of prudential regulation by RBM,” she said.
“RBM has no objection to the introduction of the charge card by Malcom.”
RBM, however, advised Malcom Limited to take into consideration some consumer protection issues such as adequate disclosure of price structure for the proposed charge card to allow consumers to make an informed decision before signing up.
Malcom Limited chief executive officer Chris Kanyuka said they will be launching the product on the Malawi market soon.
“We are happy that RBM has cleared us to introduce the charge card. We will be having workshops with service providers and employers in Lilongwe and Blantyre early next month so that they understand how the MobiMax charge card will work,” said Kanyuka in an interview.
He said employers will be giving the charge card to their employees who will be allowed to use credit of up to 30 percent of their salary and shall repay their liabilities through payroll deductions.
“The MobiMax charge card will not attract any interest save for the card swipe fee and transaction fee and shall provide security, dignity and class to cardholders,” said Kanyuka.
The MobiMax charge card shall introduce a new platform for cashless transactions in Malawi and enable cardholders to transact business without need for having cash in their pocket or bank account and shall not be restricted to any service as long as the retailer or service provider has a MobiMax PoS device installed.
Consumers Association of Malawi (Cama) has commended Malcom for its innovation, saying it will help consumers and improve the economy.
“The Consumers Association of Malawi is in support of the concept and we welcome the development in Malawi as we see immense benefit for our members and the economy,” said Cama executive director John Kapito.n