Ericsson & Rwandan Government To Boost Financial Inclusion

Communication technology and services behemoth Ericsson (ST:ERICAs) (NASDAQ:ERIC) inked an agreement with the Ministry of Finance and Economic Planning for Rwanda, to enable the country’s financial and payments services providers to connect to one common platform.

The company will leverage the Ericsson M-Commerce Interconnect solution in order to launch a national interoperability switch, which will facilitate seamless and real-time payment transactions across the country.

The contract displays Ericsson's commitment towards a new open digital economy, for which it is attempting to build the required global infrastructure.

M-Commerce Interconnect will help in upgrading Rwanda’s present infrastructure by seamlessly linking banks, money transfer organizations, mobile operators as well as payment and financial services providers.

In support of the same, the Government of Rwanda has also enacted comprehensible financial and payment services policies, so as to construct a neutral, interoperable and viable market place, which will be backed by Ericsson’s Interconnect Solution. This is a part of the Rwandan Government’s plan to create a digital economy and promote financial and social inclusion for its citizens.

Through the Rwanda Interconnect Switch, Ericsson will allow end-users to benefit from a variety of digital payments possibilities across all financial platforms and service providers. Additionally, in order to augment financial inclusion, the initiative will also include informal sectors such as micro finance players and savings cooperatives in the ecosystem.

In addition to improving financial inclusion, mobile payment technology can help people to build savings, as it provides a cost-efficient, transparent and safe way of disbursing and collecting payments to the Government as well as the private sector.

The Ericsson M-Commerce Interconnect will connect Rwandan financial stakeholders to build a real-time, irrevocable financial transactions processing solution. The Interoperability Switch is scheduled to be operational by early next year.

Ericsson has been persistently seeking out opportunities to expand its footprint in the global telecom industry. Such deals strengthen the company’s foothold in the market, expand its reach into new geographies and boost its core business, thus driving growth.

However, stiff competition, spectrum crunch issues and currency fluctuations have been weighing on this Zacks Rank #4 (Sell) company’s performance lately.

Some better-ranked stocks in the broader computer & technology sector include Ubiquiti Networks, Inc. (NASDAQ:UBNT) , PetMed Express, Inc. (NASDAQ:PETS) and DST Systems Inc. (NYSE:DST) , each sporting a Zacks Rank #1 (Strong Buy).