Subscribe

M-banking empowers the unbanked

Alex Kayle
By Alex Kayle, Senior portals journalist
Johannesburg, 02 Aug 2010

The mobile financial services industry is divided into two market segments, namely transformational banking for the unbanked, which normally takes the form of a mobile wallet, and additive banking for the already banked.

This is according to Rosemarie Pringle-Smith, Fundamo senior vice-president for global partnerships and Brazil, who addressed delegates at ITWeb's Mobile Biz 2010 conference at Vodaworld in Midrand. “In Nigeria, there are 25 million people with cellphones but no bank account,” she said.

“Consumers in emerging markets do not care about bank accounts. They care about solving problems such as transferring money and paying for things. They care about ease-of-use, speed, safety, reliability, price and accessibility.”

Pringle-Smith explained that African entrepreneurs are able to pay for goods and provide services using mobile payment solutions; an opportunity which would not previously have been accessible to them.

She added that mobile financial service platforms have also provided an additional source of revenue for mobile operators.

“African mobile operators have identified a gap in the market to provide customers with an affordable service they need, leveraging on their brand, large subscriber base and distribution capabilities.

“The minute people are able to do financial services on their mobile handset, a mobile operator's subscriber churn reduces immensely.”

When asked whether banking regulations are starting to relax, Pringle-Smith said the banking regulator has started giving more freedom to mobile operators. “In addition, we're starting to see a major push from government, which has seen the benefit of mobile banking technology. Local government has even started paying social grants to the unbanked via mobile financial services.”

The number of mobile payment users worldwide will exceed 108.6 million in 2010, a 54.5% increase from 2009, when there were 70.2 million users, according to Gartner.

The research firm says in Europe, the Middle East and Africa, mobile payment users will total 27.1 million and represent 2.1% of all mobile users in the region.

Share