Posts Tagged Mobile Money
85% of surveyed Dubai residents say they would like their mobile phone to provide payment functionality.
Total payments shared a great infographic today that highlighted the demand for NFC technologies in the UAE. The infographic was created from the results of a street survey conducted by Gemalto. The majority of respondents (87%) regard contactless payment as a way to streamline everyday activities by shortening waiting queues at the tills when shopping or commuting. Another finding from the survey is that when it comes to using contactless technology on mobile phones the majority of those surveyed say they would ‘like’ or ‘love’ to use their handset as a contactless payment method for goods and services.
The mobile financial services ecosystem is rapidly evolving and this survey reinforces the demand we are seeing in numerous markets across the Middle-East.
In February this year we announced a project in the Middle-East, in conjunction with our partner, AIRTAG for the provision of a mobile application for contactless ticketing for a public transport system so that travellers carrying an NFC enabled phone can use their phone as a transportation pass, access transit account balances in ‘real-time’ and view their recharge history.
The first phase of this project will focus on provisioning the NFC transport app with an architectural framework for an easy upgrade to a full mobile wallet solution that enables the recharge of a transit pass via a mobile money account, loyalty schemes and couponing. A full mobile wallet would also enable the ability to complete in-store NFC payments, person-to-person money transfers and bill payments.
As mobile phone markets worldwide reach a new age of maturity, operators are in search of forward-thinking solutions which exceed their subscribers’ expectations. This approach has been central to the collaboration between eServGlobal and Nepal Telecom, now entering its fifth year. Building on initial requirements for recharge technology, eServGlobal has worked closely with Nepal Telecom to progressively enrich the service offering in line with the demands of their subscriber base. Read the rest of this entry »
It was great to hear Vittorio Colao, CEO of Vodafone, talking about where he sees the mobile industry going. Vodafone has distributed 100K smart passes in Italy and is planning to roll out NFC in five markets before the summer. He also made a very important point that we need to define common standards, including the onboarding process for customers and banks alike. Global interoperability will key to making mobile money work, and I couldn’t agree more with his points.
Watch the whole video below:
The ubiquity of the mobile in emerging markets positions the operator in a unique position. While financial institutions are aware of the potential of services such as microcredit and microsavings for the unbanked, they are lacking the crucial user data needed to make this a reality.
Before they are able to launch mobile financial services, financial institutions need the ability to target customers through the evaluation of their behaviour. There are a very limited number of companies who possess such data.
This is where telecommunication operators can capitalise on the extensive user data that exists with their network. They are among the few formal institutions who have records of user data about the unbanked. Through the analysis of telecommunication usage it is possible to build lists of eligible customers for mobile microfinance. Telco data can be used to identify customer spending and geographical behaviour.
Read the rest of this entry »
The Daily Mail published an interesting infographic on how money moves around the world. According to the Daily Mail, the amount of money transferred by international remittances is now three times bigger than foreign aid, but “migrants are complaining they are being charged more than 20 per cent in transfer fees” when they send their money home. Clearly the market is ripe for disruption.
A thoughtful article from The Guardian on the need for a new way to look at remittances in emerging markets. We are facing these same challenges as we work with banks, mobile operators, and money transfer organizations to improve financial inclusion in emerging markets.
I’d be interested to hear your thoughts on how you believe the market will develop. Some of the highlights are below:
Remittances to developing countries are an important source of funding. Officially recorded remittances to developing countries are expected to reach $406bn this year, according to the World Bank, although the true size, including unrecorded flows, is believed to be significantly larger. The bank says remittance flows to poor countries are three times larger than official development assistance (ODA).
One of the key issues is the cost of transfer fees, said Unctad. For LDCs, the average cost of remitting was close to 12% of the amount sent, 30% higher than the international average, with the most expensive channels in Africa. Remittances sent to sub-Saharan Africa in 2010 could have generated an additional $6bn for recipients if remittance costs had matched the global average, according to estimates.
Unctad said African governments could reduce costs by opening the market to more remittance companies instead of signing exclusivity arrangements with firms such as MoneyGram and Western Union, which control 65% of all remittance locations in Africa despite the emergence ofnew players such as Dahabshiil.
“We would like to see greater service provision, more partnerships between banks and microfinance, [and] we’d like to see post offices more involved. But in most African countries, the financial sector is small and weak,” said Junior Davis, one of the report’s authors.
The explosion in the use of mobile phones in Africa holds some promise in cutting remittance costs but, as of early 2012, only 20% of 130 mobile banking operators such as G-Cash in the Philippines and M-Pesa in Kenya and Tanzania offered international remittance services.
The Wincor World 2012 event took place from 16 – 18 October at the A2 Forum, Rheda-Wiedenbrück. Wincor Nixdorf and around 40 partners covered a wide range of topics in both the banking and the retail industries. In addition to ATMs, branch, self service, cash lifecycle management and retail solutions, Wincor showcased a variety of innovations and forward looking ideas such as biometric ATMs, mobile control of cash machines by smartphone using NFC technology and mobile money transfer.
eServGlobal’s Mobile Wallet solution was shown with direct cash-in to the wallet from a Wincor ATM. The demo also included international money transfer directly from the mobile wallet via HomeSend, the money transfer hub offered in strategic partnership between eServGlobal and BICS.
Time Magazine recently published an article by Bill Clinton in which he outlines reasons for an optimistic outlook for a global future. He examines five areas in which there has been concrete, measurable and reproducible progress. Of these, he highlights the reasons that technology, and in particular mobile phones, have the potential to foster equality. He cites a 2010 U.N. study which found that cell phones are one of the most effective advancements in history to lift people out of poverty.
I encourage you to take the time to read the full article.
We are witnessing an interesting battle, reminiscent of the early 3G days, when “customer ownership” was at the heart of every discussion in the industry. Would the operator continue to own the customer by funneling all the services through its branded portal? Or would the content and service providers succeed in building a direct bridge to the customer, turning the operator into a dump pipe?
Interestingly, this same question has resurfaced with the boom of the Mobile Payments and Mobile Wallet industries. While traditional payment players (banks), internet players (PayPal, Google) and manufacturers (Apple) are marketing their own B2C services and promoting their own mobile wallets to end consumers, the mobile operators are fighting back, promoting their operator centric wallet, such as Isis in the US.
The business model for each of these players is very different, while some operators are betting on the mobile payments market to capture new revenues from the payment transactions, Google seems to be subsidizing the customer payment in order to gain valuable customer information (see this interesting blog post). Driven by regulatory constraints, some operators (Orange France) have chosen not to interfere with the payment transaction itself but to leverage the NFC SIM card space rental to take their share of the business.
No one can predict with certainty who will win the battle, but the operator’s experience from 3G and content services should give us a hint as to how the market will end-up looking.
The recent webinar that we hosted on Mobile Money and Mobile Payments generated some interesting questions about the current state of the market. I’d like to share this Q&A session in the hope that it will continue discussion. Keep in mind some of the answers are quite brief sure to the limited time on the day, but feel free to leave comments or get in touch if you have anything to add.
The live webinar session was recorded and can be viewed on demand from the Telecoms.com website.
Which are the most impeding factors hindering in-store contactless payments from gaining momentum? Many initiatives today provide these services without the facilitation of “real” NFC…such as use of QR-code and NFC/RFID-stickers instead of compatible terminals.
At this point in the journey, the primary factor is the cost of deployment of NFC POS terminals in the marektplace. Operators are cautious to launch mobile based NFC services in the absence of NFC being deployed on the SIM card.
What role can Personal Finance Management features play as part of the mobile financial offering in developed markets?
As more and more payments become mobile there will definitely be a growing demand for mobile based Personal Finance Management features. Personally, I see there being a huge potential for these services in emerging markets where there exists limited alternatives.
Do you see the bank controlling the customer or the telco?
The myth of anybody controlling the customer is one that needs to be dispelled. The customers will make his own decisions on what path he chooses to take. We need to focus more on the customer journey than customer ownership. The customer will go in the direction that meets his immediate requirements.