Over 80 million people in the Middle East and Africa will turn to mobile banking by 2017.
After many years of speculation and high hopes, mobile money is:
“Not the next big thing. It is already a big thing.” — Tracey Weber, Citigroup’s managing director for consumer Internet and mobile banking in North America.
Middle East and Africa mobile banking users are expected to skyrocket from 19.8 million to 82.1 million users by 2017. Over the last five years the developing world has experienced substantial growth in the adoption of mobile technology.
Emerging markets offer not only new possibilities for traditional banking but major potential for transformative banking.
According to Juniper research, there will be over 1 billion mobile banking users by the end of 2017, compared to just over 590 million this year. Whilst the forecast of 1 billion users by 2017 represents just under 15 percent of the mobile subscriber base, around half of all mobile subscribers remain unbanked, with limited access to traditional financial services.
Mobile banking having an impact on both developed countries and developing countries
Some of the biggest advances are happening in developing countries, where mobile banking is leapfrogging traditional banking to bring services to millions of unbanked customers. In developed countries, mobile banking presents profound disruption to the bank business model, but also offers broad potential as a channel for new—and existing—products and services, most notably through the leveraging of Big Data.
“Mobile billing revenues worldwide are expected to rise by $13 billion per year by 2017.” — Mohamed Anis Chemli, Business Director, Telecommunication division at Gemalto Middle East.
Meanwhile, technology research firm Gartner predicts that worldwide mobile payment transaction values will reach USD 235.4 billion in 2013, a 44 percent increase from 2012 values of USD 163.1 billion. While the number of mobile payment users worldwide will reach 245.2 million in 2013, up from 200.8 million in 2012.
Mobile banking — The ‘How To’ guide
Gemalto, the world leader in digital security, has come up with an innovative mobile payment guide, 2013 Gemalto Netsize Guide, aimed at providing insight for users, mobile operators, banks, credit card companies and merchants.
“The popularity of the smartphone depicts the rise in mobile usage. This is why the guide explores the big picture of mobile security, identity, privacy, and social commerce, while focusing on mobile wallets, in-app micropayments and money transfer, operator billing and messaging, as well as Near Field Communication (NFC).” — Gemalto
The popularity of the smartphone and the accessibility of data connections have established mobile devices as being invaluable for consumer purchases, personal banking, merchant transactions, and peer-to-peer payments.
Customers use mobile phones to enjoy services offered by businesses and data providers, thus giving mobile operators an additional opportunity to monetize their network services. According to Juniper Research, 11. 9 million mobile users in Middle East and Africa made transactions through mobile devices in 2012 and figures are expected to reach 71.9 million users by 2017.
Mobile devices are a vital form of today’s global communication. VISA estimates that by 2020, mobile payments will account for more than 50 percent of mobile users transactions. These trends necessitate that industries have in place a mobile strategy for commercial success.
e-Book: Mobile Banking: Financial Services Meet the Electronic Wallet
[email protected]’s eBook takes a detailed look at the mobile-money revolution, with an eye toward the strategic challenges for banks.
Excerpts from the eBook:
Mobile banking is a revolution with many faces, a battlefield with many players. The main players apart from banks are; Telecommunication companies, Internet and technology firms, retailers, and others are all part of this mobile-money battlefield.
Mobile money is reshaping economies by introducing the financial system to millions of unbanked consumers. In a number of nations, the firms that have captured the market are not banks; instead, telecoms have led the way.
Ten or twenty years from now, mobile money will be a ubiquitous and transparent part of consumers’ lives. The company, or more likely the consortium, that owns that process will profit not only from the transactions themselves, but also from all the information that mobile commerce generates about consumers and their preferences. Those who fail to get a jump on mobile money will be left behind.
Challenges from Non-Banking players. Banks faces new challengers from outside banking (Google, Intuit, Microsoft, PayPal, and Square) who are leading the charge to win control. Whether banks consider these players as partners or competitors, a number of inter-industry collaborations are under way alongside newly formed intra-industry consortia, all vying for a toehold that shared skills and knowledge might provide.
Regulatory challenges. Mobile banking faces a number of challenges on the regulatory front. Questions on whether nonbanks should be allowed to provide banking services without the involvement of a bank, authority over the electronic transactions; whether it will be banking regulators or telecom authorities, how central banks can control the money supply and preventing money laundering- are some of the questions which still need clarity.
The full eBook is available as a Free download here.