The National Assessment of Terrorist Financing Risks report warns of a high level of threat posed by the Electronic Money Institutions (EMI) sector in Mozambique. According to the document, published by Lusa, there is an excessive movement of funds to active terrorist threat zones using EMIs operated by telecommunications in the country.
According to the report, active terrorist threat zones prefer to use Electronic Money Institutions because of the ease and speed with which funds can be moved, which makes this sector attractive for possible abuse by terrorists. The mobile money market has been growing in Mozambique, driven by the increase in the number of cell phone users, especially in rural areas, where penetration is higher compared to traditional banking.
In September 2023, the value of the EMIs’ assets stood at 16.9 billion meticais, with an accumulated share capital of 2 billion meticais. The report highlights that only around 30% of the Mozambican population has access to formal financial services, and that the expansion of EMIs has contributed to financial inclusion and facilitated the movement of funds between people.
The document also mentions that at the end of 2021 and beginning of 2022, in Cabo Delgado province, transactions were made mainly in cash and with the use of mobile wallets, due to the weak control of the system. This led terrorists to use these wallets as the preferred mechanism for moving funds channeled by family members, friends, sympathizers and others.
Financial intelligence authorities have been alerting e-money institutions to the movement of large sums of money through these channels, with a view to regularly sending reports of transactions suspected of terrorist financing and money laundering.
