Mobile Payment Magazine

Mobile Banking & Payments for Emerging Asia Summit: Oct. 8-9, 2012 – Conrad Bali, Indonesia

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Clariden Global presents the inaugural Mobile Banking & Payments for Emerging Asia Summit to discuss the roles of m-banking and m-payments for emerging Asian markets, how industry stakeholders can move towards enabling implementation & adoption while managing regulatory & interoperability barriers.

This 2012 event will discuss the roles of m-banking and m-payments for emerging Asian markets, how industry stakeholders can move towards enabling implementation & adoption while managing regulatory & interoperability barriers in the drive to provide anytime, anywhere banking services to the emerging Asian population.

The Mobile Banking & Payments for Emerging Asia Summit 2012 brings together Asia’s mobile banking & payments stakeholders to discuss the roles of m-banking and m-payments for emerging Asian markets, how industry stakeholders can move towards enabling implementation and manage regulatory & interoperability barriers, in order to penetrate the emerging markets in Asia.

Key Highlights for the conference:

  • 3 Day Dedicated Mobile Banking & Payments Summit
  • 5+ Key Emerging Market Case Studies: Indonesia, Philippines, India, Pakistan, Bangladesh, Kenya
  • 18+ Mobile Banking and Payments Ecosystem Frontrunners
  • 20+ Solutions Driven Presentations for Mobile Channel Stakeholders
  • 24+ Hours of Professional Learning & Networking Opportunities
  • 2 Industry Practitioner Led Workshops to Maximize Your Mobile Banking & Payments Deployments in Emerging Asian

More information: Clariden Global.

Banking the Unbanked: Report Examines Mobile Banking in Emerging Markets

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World Economic Forum, prepared in collaboration with The Boston Consulting Group.

Despite the broad awareness that mobile financial services can serve as a means for “banking the unbanked” on a global basis, widespread adoption has yet to be achieved, according to the Mobile Financial Services Development Report 2011, a new report released by the World Economic Forum and The Boston Consulting Group. According to the report, to meet the financial needs of underserved populations, most countries—even those that have achieved scale with mobile money transfer—should focus on the flexibility of regulatory provisions for nonbank players, the competitiveness of market structures, and the strengthening of financial literacy skills of individuals.

The report provides a comprehensive analysis of more than 100 variables across 20 countries in Africa, Asia, and Latin America. It measures the critical factors necessary to achieve meaningful scale of mobile financial services and meet the needs of billions excluded from the formal economy, and notes that the adoption of mobile financial services is currently confined to a few countries where, historically, access to financial services has been constrained and the scope of services limited to mobile money transfer. The findings suggest that financial services such as savings, credit, and microinsurance are only now becoming available and that regulatory environments, market competitiveness, and financial literacy of end users all need to be collaboratively addressed before meaningful scale can be achieved.

Countries such as Kenya and the Philippines are among the few covered by the report that have achieved adoption levels of more than 10 percent of the total adult population. A defining characteristic of these countries is a dense network of agents—retail access points where it is possible to register account holders and handle cash transactions. However, as these countries look to achieve scale in mobile financial services other than payments, it will be critical for them to focus on factors such as government disbursements through the mobile platform, the competitiveness of their financial and telecom sectors, and better data collection and monitoring to facilitate “test and learn” approaches.

“Including millions in the formal economy by providing them with tools to transact and save can have strong positive economic and social benefits,” said Marc Vos, a partner in The Boston Consulting Group’s Technology, Media & Telecommunications practice. “But public and private stakeholders must first get the basics right: solid and efficient distribution networks close to the consumer, and regulations that combine openness to innovation with protection of consumers and broader financial stability.”

In terms of the array of enabling factors covered in the report, several countries, such as Brazil and India, demonstrate areas of relative strength when compared with countries that have already achieved scale in mobile payments. The ability to leverage existing agent networks and consumer protection in Brazil may facilitate the development of more complex financial services through the mobile platform. The widespread availability of mobile phones within India, the degree of competition within its telecom sector, and recent regulatory changes may drive dramatic improvements in adoption levels.

Estimates of the levels of adoption of mobile financial services in the 20 countries surveyed were compiled through an analysis of deployments done in collaboration with the GSMA Development Fund. A survey of regulators, conducted jointly with the Alliance for Financial Inclusion, provided data on regulations specific to mobile financial services. Data from a number of secondary sources such as the Consultative Group to Assist the Poor were also integrated into the analysis. The report contains a profile for each country featured in the study, including a summary of the relative advantages and disadvantages within its mobile financial-services ecosystem, as well as an extensive listing of data tables showing results for each variable used in the country profiles. The data set is available for download and can also be analyzed online with other World Economic Forum data sets for deeper and customized analysis.

Some report highlights:

  • Few countries have achieved meaningful scale in mobile money transfer—mobile savings and credit services are still in the initial stages of development.
  • Dense agent networks are characteristic of countries that have achieved scale in baseline mobile money-transfer services.
  • Government disbursements through the mobile platform, continued cooperation and innovation among industry sectors, and improvements in the quality of data sharing are opportunities to help unlock growth.

More information: Mobile Financial Services Development Report 2011

 

Source: Boston Consulting Group (BCG)

Western Union Provides Mobile Money to M-PESA Subscribers in Kenya

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Western Union now provides services for consumers to send money directly to the mobile “wallets” of Safaricom M-PESA subscribers in Kenya from 45 countries and territories. According to the company, it’s the first service of its kind in the world.

The expansion of the service to more than 80,000 Western Union Agent locations worldwide follows the successful debut of the offering from Western Union Agent locations and the Western Union website in the U.K.

The service rides on Western Union’s worldwide network and trusted global “hub” for processing cross-border remittances. It also builds on the unprecedented success of M-PESA, a domestic mobile money transfer service in Kenya offered by Safaricom that has attracted more than 13.5 million customers since its launch in 2007.

“We are pleased to extend our service with Safaricom, and we look forward to adding additional functionality for M-PESA users in the near future,” said David Yates, Executive Vice President and President, Business Development and Innovation, Western Union.

The service will allow people to visit one of more than 80,000 Western Union Agent locations in 45 countries and territories across the globe, including the U.S., Canada, Italy and the U.K., and send funds directly to the mobile “wallets” of M-PESA’s 13.5 million subscribers. Funds are delivered generally in minutes.

The service will likely benefit thousands of Kenyans working abroad. According to the Central Bank of Kenya, Kenyans living outside their home country sent US$642 million home in 2010—up from the US$609 million sent home in 2009.

Safaricom CEO Bob Collymore said, “Our customers are very proud of the revolutionary M-PESA service, and this partnership sees us pushing new boundaries to continue to keep Kenya at the forefront of the mobile world. Through this partnership, our customers and their friends and families will benefit from affordable, faster and more convenient international remittances, and the money is available to use straightaway for any M-PESA transaction, or can be withdrawn as cash at any of our 24,000 Safaricom agents.”

Western Union offers the Mobile Money Transfer Service in the Philippines with Smart Communications and Globe Telecom; in Malaysia with Maxis; and in Canada with EnStream. Western Union also has agreements with other mobile operators and banks to introduce the service in the future.

Source: Business Wire

In Rural Kenya, M-Pesa Used as Savings Account Too

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In Kenya, with banks often few and far between, 65% of population uses M-PESA. 81 percent of M-PESA users said they used M-PESA for saving.

As the developed world begins its recovery from the global economic meltdown, the financial architecture in parts of the developing world is being rapidly transformed by a mobile payment system that enables people to deposit, send, and withdraw money with a push of a few buttons.

Established in 2007, the sms-based service, known as M-PESA, has enabled Kenyans to both save money and better withstand serious blows to their personal finances, according to new research by Tavneet Suri, a professor at MIT’s Sloan School of Management.

Suri and her colleague William Jack, a professor at Georgetown University, conducted two surveys of 3,000 households in Kenya: the first was in 2008, the second in 2009. They found that nearly 60 percent of Kenyan households now use M-PESA for person-to-person transfers, as well as to pay for everything from school fees to mobile phone credit to electricity bills.

“Kenyans find using M-PESA faster, more reliable, and more convenient than a traditional bank,” says Suri. “There are nearly 25,000 M-PESA agents in the country compared with 850 bank branches. In Kenya, if you want to transfer money from your bank, you need to travel long distances, stand in line with a fistful of cash, and fill out a bunch of paperwork. M-PESA agents, on the other hand, are often found at gas stations and grocery stores, and some are open 24-hours a day.
Although M-PESA balances do not earn interest, the service has some of the functions of a bank account but is much easier to access, and much easier to manage.”

According to their survey, the vast majority of Kenyans – over 80 percent – stash some of their money “under the mattress,” but M-PESA is fast becoming an important savings tool.

In 2008, about 75 percent of users said they used M-PESA for saving, and by 2009 this increased to 81 percent. By that year, half of all households said M-PESA was one of their two most important savings instruments.

“People are able to amass savings on their M-PESA accounts over time,” says Suri. “By providing a safe storage mechanism, the service could increase net household savings over the entire population.”

Most important, the expanded ability to make interpersonal transfers deepens the person-to-person credit market, which helps Kenyans withstand shocks to their household finances through risk-sharing networks.

In the developing world, a poor harvest or an illness can quickly portend financial ruin. Because mechanisms like unemployment insurance and health insurance are limited, people in Kenya have created informal risk-sharing systems whereby wide networks of friends and extended family give money to those in need with the implicit understanding that when they one day find themselves in grim circumstances, the favor will be returned.

This arrangement in the past has been fraught with risk. Poor roads, an inadequate transport system, and expensive money transfer services, like Western Union, mean that people wait a long time for their money, and often, conditions worsen.

“In the US, if you lose your job you may well be eligible to receive unemployment insurance, in which case you would continue to be able to eat three meals a day,” says Suri. “But in developing countries, when you lose your job, there are often no formal safety nets. People don’t have a lot of savings or other ways to smooth these shocks so their food consumption drops.”

But this is not as true for users of M-PESA. According to Jack and Suri’s research, the consumption of M-PESA users falls about 6 percent less during a crisis because they are able to receive money from a network of family and friends.

“It appears that M‐PESA facilitates efficient risk sharing and enables support networks to keep negative shocks manageable,” says Suri. “For example, a household head with access to M‐PESA who suffers a mild health shock might quickly receive a small amount of money via M‐PESA that allows him to keep his children in school. If this money was delayed, the children might have quit school, the effects of which are hard to reverse.

“The way M-PESA improves the ability of households to manage risk is dramatic and has important implications for the welfare of virtually all Kenyans,” she adds. “M-PESA has helped households overcome some of the most impenetrable barriers to financial services, and has provided real value to Kenyans, especially during a time of need.”

*The Risk Sharing Benefits of Mobile Money By Tavneet Suri, MIT Sloan School of Management and William Jack, Georgetown University; January 2011

Source: PR Web

Mobile Financial Services Provide Banking Solutions to Rural Kenya

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Nuru International, a U.S.-based social venture that equips the poor living in remote areas to end extreme poverty in their communities, is using innovative new technologies for mobile banking to increase access to basic financial services for rural households in Kenya. The organization is working with Mifos cloud-based MIS and M-PESA mobile money transfer services to create a viable solution to some of the issues that persist in providing financial services in these difficult service areas.

“One of the biggest problems we face when it comes to finance and banking for the extreme rural poor is how to disburse loans and payments to our farmers, we don’t want to give large amounts of cash to them because they have to cover long distances on foot, have no secure place to keep the cash, and robbery and theft are real concerns.” — Vivian Lu, Community Economic Development Program Manager.

Nuru’s microfinance program has helped extend the reach of mobile money in rural Kenya. The combined technologies of Mifos and M-PESA have helped to create a branchless banking structure, allowing Nuru savings members in remote areas of Kenya access to some of the basic financial services that traditional banks offer. M-PESA is a mobile phone based money transfer service offered through Safaricom, allowing users to transfer money to other users, pay bills, and purchase air time. The service has great potential to be leveraged in mobile banking, allowing people to complete basic financial transactions without needing to visit a physical bank. Mifos is developing integration with M-PESA and allows Nuru an affordable way to scale. Because it’s a cloud-based application, Nuru can access it from mobile phones and netbooks, improving their reach in rural areas.

Nuru recognizes the importance of savings as a critical and often overlooked component to economic growth in rural areas. The Community Economic Development model is a savings-led program that offers financial training. Nuru members are trained in the fundamentals of financial planning, budgeting, saving, and responsible loan management, before they are eligible to apply for individual loans.

Source: PR Web

M-PESA Wins “Mobile Money for the Unbanked” Award

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Safaricom’s M-PESA has won the Mobile Money for the Unbanked Award at this year’s Global Mobile Awards 2011 which is being held in Barcelona, Spain between February 14th and 17th.

The M-PESA service was launched in March 2007. As of the end of 2010, the service had over 13.5 million customers countrywide. More than 400 organizations acceppt Bill Payment via M-PESA. The service does not require users to have a bank account; an important aspect in Kenya, where millions of people do not have a bank account. With M-PESA, account holders can buy electronic funds at an M-PESA agent and send the electronic value to any other mobile phone user in the country, who can then redeem it for conventional cash at any M-PESA agent. The awards are part of the annual Mobile World Congress which brings together players in the global telecoms market and is organized by the GSMA (Global System for Mobile Communications Association).

The “Mobile Money for the Unbanked” award category recognizes innovative, sustainable, pioneering mobile money services around the world that bring low-cost financial services, through mobile, within the reach of low income groups. The award recognizes the mobile money service that has had the most significant impact on unbanked customers in developing markets over the last year.

The win extends a five times winning streak by Safaricom M-PESA at the GSMA conference in over a three year period, and is a fitting recognition of its leadership in Mobile Money services.

Safaricom CEO Bob Collymore exalted in the win and said it was a validation of ongoing work to expand the M-PESA service in line with meeting the needs of the Kenyan customer.

“I am delighted and congratulate the M-PESA team. This shows that we are leading the evolution of mobile money from simple transfer to a total mobile commerce solution,” he said.

The judges said in their citation: “The success story continues. This solution is enhanced further with the addition of new features and territories. It is winning ground in a way seldom seen in the mobile industry and is a true and sustained success story.”

This years entry, put together jointly with Vodafone, covered M-PESA in Kenya, Tanzania, South Africa, M-Paisa in Afghanistan, India and Fiji, and Vodafone Money Transfer in Qatar, bringing together the strengths and benefits of the service to the firm’s customers across the group.,

The GSMA, which organizes the awards, represents the interests of the worldwide mobile communications industry. Spanning 219 countries, the GSMA unites nearly 800 of the world’s mobile operators, as well as more than 200 companies in the broader mobile ecosystem, including handset makers, software companies, equipment providers, Internet companies, and media and entertainment organizations.

Since the launch of M-PESA in just over 3 years, M-PESA has bagged a total of 12 international awards in its contribution to offering financial inclusion to the un-banked in Kenya.

Source: Safaricom