In January I took part in MMT APAC where I made a joint presentation with Dodi Virgianto, from mCoin, around how mobile money will enable money transfer in Indonesia.

Mobile money has huge potential for emerging markets like Indonesia where there is a high percentage of migrant workers who have left their homes in rural areas in search of better income in the cities. The population of Indonesia is 230 million, of which more than 60 million are unbanked. There are also more than 25 million migrants within Indonesia. People are already sending money from cities to rural areas, however there is a limited number of existing services and the associated fees are quite high, usually between 5 and 10% of the transaction volume.

Another reason why Indonesia is a great market for mobile money is because of a very high mobile penetration rate. There are already over 230 million mobile phone users in the country, most of which are prepaid. Indonesians have a history of embracing new technologies, they are the second largest number of facebook members in the world after the US, and the main point of access if through the mobile phone.

So what challenges need to be overcome to launch a successful mobile money service. Firstly, meet all regulatory requirements, this is essential in any country. It is also important to target the right customers – the migrant, unbanked customers will see huge benefits in a mobile money deployment. Once launched, Promotion can play a huge role in encouraging adoption. The potential to combine the power of promotion with mobile money is an emerging trend from innovative operators and financial service providers around the world.

eServGlobal and mCoin are working together to build a service which brings unique value to the Indonesian market. We are building a service which is focused on consumer to consumer domestic money transfer, geographical and ethnic specificities and promotional activities.