MOBILE MONEY & MOBILE BANKING

THE RAISING BRANCHELSS BANKING INDUSTRY

What is mobile money?

Person to Person (P2P)

Mobile Banking

Person to Business (P2B)

It refers to a suite of financial services offered through mobile phones and other handheld mobile devices (Jenkins; 2008, Harvard Kennedy School)

Check balance, deposits…

Therefore within mobile money we include:

Is the delivery of financial services outside conventional bank branches using information and communications technologies and nonbank retail agents. (Consultative Group to Assist the Poor; 2009)

Branchless Banking

79 live deployments86 planned deployments

Deployment tracker

http://www.wirelessintelligence.com/mobile-money

Mobile Money and Branchless Banking Worldwide

MODELS OF MOBILE MONEY

Additive models

Transformational models

Numerous and very diverse

We need a classification:

Mobile Money is merely an extra channel to access to financial services

Mobile Money provides access to financial services to the unbanked population

MODELS OF MOBILE MONEYAdditive models Money transfers

Bill Payments

Savings

Insurances

Loans

Mobile Money

MODELS OF MOBILE MONEYAdditive models – Branchless Banking

MODELS OF MOBILE MONEYTransformational models

Money transfers

Bill Payments

No Bank account is needed

MAIN ACTORS

Market penetration

Ownership of technology

Legal limits

Expertise and legal rights

Traditional model no profitable in developing countries

Legislation is the key Policies and market

regulation Limits for non-financial

institutions

COMBINATION ACTORSOnly Telco company Only Bank company

Partnerships

TRANSFORMATIONAL MODELS M-PESA - G-CASH Kenya Country Philippines Apr 2007 Launched Oct 2004

SAFARICOM Company G-GLOBE 9 m Users of m-banking 2 m19.296 Agents countrywide 1.500

Service allows usersMoney transferBill Payment

Based on:SMSRetail agents

ADDITIVE MODELS

COUNTRY BrazilLAUNCHED 2002 approximately COMPANIES Bradesco, Caixa Economica

Federal, Banco do Brasil, Banco Lemon

USERS BRANCHLESS BANKING 13.000.000 AGENTS COUNTRYWIDE 130.000

BRANCHLESS BANKING

Service allows usersMoney transferBill PaymentGovernment welfare payments

Extensive use of retails agents

COUNTRY South Africa

LAUNCHED 2004

COMPANIES MTN, FNB, MoPay, Wizzit, Standard Bank

USERS 1.5 m

ADDITIVE MODELS

Wide legislation in relation with mobile money

Government support - Legislation and distribution of welfare payments

CONCLUSIONS

Main questions for the future

Companies involved

New products and services

Security

Telcos ----------------Banks

Legislation

Consumers, Governments, Companies

Convenience for retail agentsInternet

Savings, Loans

Competition, interoperability

What can we learn from the current models?

CONCLUSIONS

Reaching the unbanked

Accessibility is essentialNew players in old markets

Re-using existing resources

Still low revenues – no profitableCountry profile determinant

THANK YOU

Sol Trumbo VilaEconomic development

and international relationssoltrumbo@gmail.com