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SMS PAY - Pay School Fees, government services, and Businesses using SMS

SMS Pay for Schools;

 A parent uses a simple SMS to pay school fees from his mobile money account to a school. This doesn’t require the parent to have a smart phone with her. A parent types an SMS e.g. Pay 193 10000 2020s10 and send to a short code 6115. The message has a school code, amount to pay and student id in it. The parent receives a mobile money pop up to approve the payment; Enters PIN and payment goes to a school.

 A school bursar or director will receive a real time sms notification notifying him/her about a school fees payment for a specific child.

 Similar service is available for public to pay government services and various businesses. To pay for that, one simply types Pay BusinessCode Amount and sends to same short code.

Money parents send is auto-transferred from a School wallet to the School Bank account. This means the parent/public don’t have to go to banks to affect/make payments. 

Define three specific objectives that you would like to achieve with your proposal.

Our main goal is to digitize Ugandan SMEs and Schools plus advise them on to how to perform better by studying their income and expenses data. Our goal is backed up with a pillar of following objectives:

To provide a Centralized Smart Digital Wallet for a merchant/school to track all incoming and outgoing payments. 

To ease cash to bank transfer for all SMEs/Schools and save time plus money.

To reduce cash theft, fraud and delayed payments by providing a Secure smart wallet thus easing Cash collection

 

What problems (particularly in value chain competitiveness and global disruption) are your community’s stakeholders facing due to the Covid-19 pandemic?

Long Congested Queues while paying for public e-services/school fees. Public e-services include ura taxes, passport fees, police clearance fees, police traffic fees and others. A lot of people congest and queue at banks while paying these fees; this wastes a lot of time and money. This results into a lot of congestion which isn’t good as per guidelines of COVID-19 SOPs. There is a bigger number of people paying for these fees since its one of the objectives for them to achieve their goal e.g.  A parent has to pay school fees for his children to study.

What minimum viable solution(s) are you proposing to address the challenge(s) in your community?

With our solution (SMS PAY - Smart digital wallets for Merchants) one just has to stay Home; opens and creates an SMS to affect the payment to any registered merchant/school from his mobile money account. (Merchants/Schools wallets auto transfer available money to their bank accounts).

 This is simple and so fast to effect payments than moving to banks.

Share your story (your narrative)

Growing up as an innovator and a parent, a faced so much difficulty in paying school fees and at the same time working under a very tight schedule. With my background technology in mobile money systems and availability of home schools to give me time to survey them;

 I found out that most parents have no smart phones and indeed prefer school fees payments without going to banks. Hence development of SMS Pay. (Based on Powellpay; Powellpay is an application we worked on earlier that enables parents with smartphones pay school fees from there wallets – SMS Pay is an extension of Powellpay)

Please provide any additional relevant information that you would like to share.

SMS Pay is part of Powellpay.

Powellpay is currently being used and tested as an MVP; This means SMS Pay has a good and extensive continuation.

edited on Jul 27, 2020 by Samuel Mugabi
Public (14)
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James Kiruri Jul 28, 2020

Hello Samuel, well done on your idea. Is this service not covered by MTN and others using their mobile money service. You will need to move quickly and get traction if this is not being provided by the telcos. I am sure you are aware of what Mpesa service has done in Kenya to change the way micro payments are done. All the best

Samuel Mugabi Jul 28, 2020

Thanks for the Feedback; We are in Uganda and no one has implemented this yet. MTN has channels that only offer mobile money and that is how we partner with it; It does not have Keyword SMS ShortCodes connected to mobile money. i will do more research about Kenya Mpesa, Thanks for the insight.

Sunday Bawa Jul 28, 2020

Hi, banks have ussd codes made up for schools to provide this service how is yours different from what they are offering?

Samuel Mugabi Jul 28, 2020

A company called Schoolpay in Uganda offers USSD connection to Banks, So parents pay using USSD to schools. We although think the USSD procedure is a long process and thus a Simple SMS would make life more easy for parents. Also Being an initial of an idea we would want it to be so expensive for us to maintain. Costs of USSD implementation are almost x5 higher than SMS Keyword Implementations. Hence we want to save while growing and gathering traction. Thank you

Thomas Mueller Jul 28, 2020

Dear Samuel, a great Idea. In 2017 I created a complete digital system for student applications for there loans. In order to apply they needed to check eligility based on their grade 12 results. We created this database in the backend and offered this using a single API on different frontends such as SMS, USSD, FB Messenger, WebSite.

Is the School Fee to be paid taken from the Airtime credit?

Samuel Mugabi Jul 28, 2020

That was an interesting prospect. We shall also have loans given out to parents based on their fees payments behavior pattern using our system that earns them a credit amount.

We have actually tested this idea and people like it.
the SMS initiates a request or prompt for the parent to enter their mobile money pin to approve the payment. The money comes direct from the parents mobile money account. After a parent approves money is taken from his mobile money account to a school wallet he/she specified.

Thomas Mueller Jul 28, 2020

Thanks Samuel, A great approach which I really like. If your technology is micro service based and API first, it will be very flexible and scalable and you can make use of it for many more scenarios.

Samuel Mugabi Jul 28, 2020

Thank you so much; I appreciate the feedback.

Jaymer Jayoma Jul 29, 2020

Hello Samuel,

Good day, the idea is good. However, how do you address security issues?

Samuel Mugabi Jul 29, 2020

Hello Jaymer, Thanks for the question; Currently this is an add-on to our core system Powellpay; Powellpay has been in existence for over a year with over 1,000 users while running real time and secure transactions.

1. Since it's an extension to an existing core and secure branch; Security is at honor and quiet good.
2. We also partner with interswitch in bank payments. Interswitch has an experience of over 10+ years. We use its API to send bank payments from Powellpay wallets. SMS Pay deposits school/business money to Powellpay wallets. Powellpay wallets auto transfer money to bank as soon as it passes a limit.

Joshua GBEMISOLA Jul 29, 2020

I read through your comment detailing why you can not go for USSD. I actually wanted to recommend USSD because it is more secure. Do you have any plan for additional layer of security in mind that can prevent interception?

Samuel Mugabi Jul 29, 2020

USSD is in the 2nd phase of our implementation once the User journey with SMS is tested and done.

We went for SMS because;
1. Its cheaper to maintain for a start while doing an MVP and Survey tests.
2. Similar Code Base and APIs can be Extended once enough money is available to maintain USSD.
3. In the survey we did earlier, 70% Parents prefer SMS (single line typing) than USSD longer steps already available.

For additional security yes; An SMS is programmed to interact with an existing and tokenized layer in the back end. Plus our SMS Pay doesnt let money flow out of the system; (We only use it to receive money not to pay out)

Pay outs are done by an existing back end system (Powellpay Dashboard).

Issoufou Seidou Sanda Jul 29, 2020

Dear Samuel,
digitization is definitely the way to go to reduce contacts and spread of COVID-19. I did not understand the statement that the parent did not need to have a smartphone while the parent still had to send an SMS and receive a notification on mobile phone. I assume it means that the parent can use someone else's smartphone and authenticate herself/himself through the PIN code. A possible vulnerability in this case is that the owner of the smartphone can log the keys that are pressed and discover the PINs of other people. The owner of the phone can also see the SMS that was sent and identify the PIN, unless it is encrypted. You can use a series of "one-time-passwords" to avoid such vulnerability. However it is not a critical vulnerability in a community where people trust each others.

Samuel Mugabi Jul 29, 2020

Thank you for the insight; Parents use their phones to send the payment. Any phone works, Why we said no smartphone needed is because the system only uses SMS to pay. that means no internet needed in the process of payment; Any simple phone can do it.

Parents are to be given payment cards so that they can at any time remember how the message syntax is and type it correctly.

Although an option would be them to give a mobile money agent the card to help them pay; This is because payments are recognized at the school end by a student ID primarily not the phone number paying.

We strictly encourage and teach all parents to this payment method so that they can do it them selves as well as teach them on safety of mobile money techniques like keeping their PINs secret. These lessons happened in sessions provided to us by the schools at specific events like Visitation days or parents meetings.

Tafadzwa Chikwereti Jul 30, 2020

Hello i see yyou're new here Anyway this is a small piece of advice My advice Start small and build momentum, Being a social entrepreneur can be very difficult, you are constantly in a field dominated by changing dynamics, you will often face business challenges, and you have to start small and build your enterprise from the ground up. You must be resilient, realistic, and passionate about your goals and the impact you are trying to achieve. To add to your solution, I am sharing with you questions from one of our trainings that can help in refining our ideas and projects What business model will you follow to implement this idea? What methodology or strategy will you use during different processes of implementing this idea? Which are the processes you have to go through until the finalization of the idea? What means or tools do you need to implement my idea? Which are your potential collaborators, investors? I honestly suggest that before you submit your idea or project, please and ask yourself these questions and even if you have submitted their project, do remember that we still have opportunity to refine our ideas and resubmit. I hope that you find this useful. Also, please create time and take the campus online trainings as the trainings are there to help campus members understand what it is to be an entrepreneur. Consider my idea vote and comment on it Let co create Thank you

Samuel Mugabi Jul 31, 2020

Before i attempt your questions; am not so new to innovation, i have been in this field now 3+ years and i have gotten or won some funds and awards. This idea is being surveyed in probable schools and they already love it. We have already won appointments and schools willing to sign on to use it.

To start answering your questions now;
What business model will you follow to implement this idea?

We are proposing to charge parents a percentage commission on the fees they send to the school. the schools receive their money in the bank as it is sent. Commission is paid differently on top of school fees.

What methodology or strategy will you use during different processes of implementing this idea?
We have done surveys to refine the flow of the idea. We have already did this with Directors and headmasters of schools in Uganda. these were approximately 130+ schools. Many things changed; one of them was the business model, value proposition and users; We have also won partners with SMS media companies and telecoms and tested this well.

Which are the processes you have to go through until the finalization of the idea?
We have refined the idea to a point where its usable through iterating with the user journeys; We are now continuing bringing on board new schools plus seeking what new schools want to be implemented.

What means or tools do you need to implement my idea?
We have finished this already; We are just left with go to market and growth. what slowed us down was COVID since students went home.

Which are your potential collaborators, investors?
We won some fund from telecoms in Uganda; Potential collaborators we have partners with on this include;
MTN Uganda and Airtel Uganda;- for Providence of the Mobile money API we use.
Interswitch Uganda;- provides us with APIs that transfer money to Banks
AfricaIsTalking;- Provides an SMS Keyword and Code we use in implementation.
Cloud services;- Where we deploy Code.

those are some of the partners or collaborators that made this possible.

Thanks for the questions and Advice.
We appreciate.

Carol Kakooza Aug 6, 2020

Hi Samuel i have to say this is great innovation and i love that it reduces the burden as experienced in the us of USSD. I would however like to know why you interest is with school fees payments mostly where several interventions have been offered. How do you intent to beat your competitors in the game and more importantly what consideration do you have for other sector players like SMEs who would offer a bigger market in my view... thanks and your vote for our innovation will be highly appreciated

Samuel Mugabi Aug 7, 2020

1. School Fees payments are frequent and a mandatory for most parents to attend to. This brings growth in traction and users. Also new schools keep opening up meaning there is growth in population which all needs to be educated.

2. We intent offer a bit wide range of services like Bill payments, POS payments, Automatic Bank transfers, Mobile and Bank bulk disbursements, Loans based on credit scoring of users who use the system, Plus data analytics and insights.

3. For SMEs we also offer usage of our API at a small commission fee of 3% per transaction. And we give them free incoming transactions in case they register with our main app (Powellpay) i.e they can then receive payments from powellpay users for free.

Again, Thanks for the Feedback Please.

José Salgado Aug 18, 2020

Hi Samuel,

It's a great idea, easy to use, I hope you can make it useful to your people, keep the good work!

Samuel Mugabi Aug 23, 2020

Thank you please

Muyunda Kaonga Aug 21, 2020

Hello Samuel, awesome idea and I love the fact that you want to make payment easy. You maybe in a competitive space, what is different about your solution and how secure is it from frauds. Then does it require parents to deposit money into the account they open with you? What's the difference with Mobile money like Mpesa?

Samuel Mugabi Aug 23, 2020

Hello;

1. We are operating with partners with top secure platforms like MTN, Airtel and Interswitch. This provides us with top guaranteed security in transcations access and safety.

2. For SMS Pay, Parents dont need to deposit money anywhere. Money is got direct from there existing mobile money accounts with existing Telecoms.

thanks for your questions please

DJ Koeman Aug 26, 2020

how nice! Yesterday i was talking to one of the people that I am mentoring and he was suggesting something similar for landlords/tenants. No more chasing tenants whether they have paid or checking with your bank. Have you thought about testing it or asking for instance Bridge International Academies https://www.bridgeinternationalacademies.com/ whether this is something for them? Or are you targeting more the schools that are smaller in scale?
In the meantime, you may want to have a look at our idea and vote for it if yo like it: https://cocreate.itu.int/post/3496670

Samuel Mugabi Aug 26, 2020

We have tested in several schools. We are yet to expand more when schools resume. Thanks for the insight, We shall be visiting them to and we see if there is need.

For other sectors like SACCOs, Rentals etc we are still exploring them to come on board too.

Israel Abazie Aug 29, 2020

I have this to say Samuel. Your idea submission looks simple but very innovative. I love it! However, it seems as though there are existing platforms that serve this purpose in your area. If this is not so, kindly fly this as quickly as possible. Your idea could scale from nursery school to secondary and tertiary schools ideal for older parents that find it difficult to make use of smart devices. It also ensures students don't spend their tuition fees on trivialities or gamble with them but make payments as and when due. On another note, how do you make money? You will need to state if your app operates a freemium model or a subscription kind. You might want to add a feature that auto-generates invoices for your users to track their payments. Then go ahead and onboard schools in your community. Goodluck!

Samuel Mugabi Aug 31, 2020

how do you make money?

We charge a transaction fee per payment a parent makes to a school. eg if a parent is paying 50 USD, We charge 2 USD; so a parent pays a total of 52 USD.

You might want to add a feature that auto-generates invoices for your users to track their payments.

All payments have digital receipts auto generated at payment confirmation. These receipts can be downloaded by school administrators and given to parents. (They are generated from SMS PAY Dashboard - Only Schools access)

Thanks so much for the feedback and recommendations. We are looking forward to pitch more to schools. We believe this is so good for them.

Olajide Ogunmoroti Aug 29, 2020

Dear Samuel,
This is actually one of the solutions we need at this point in time.

PS: Please like or give advice to my project https://cocreate.itu.int/post/3488310

Samuel Mugabi Aug 31, 2020

Thank you for your Comment.

Olajide Ogunmoroti Aug 29, 2020

Dear Samuel,
This is actually one of the solutions we need at this point in time.

PS: Please like or give advice to my project https://cocreate.itu.int/post/3488310

Samuel Mugabi Aug 31, 2020

Thanks for your comment.