Must Read of the Week
This week, there are two must read articles: 1) Detailed Guide to Mobile Payments: Digital Wallets which has been prepared by Deva Annamalai; 2) GSMA’s 2014 State of the Industry Report on Mobile Financial Services for the Unbanked. We at Banking Beyond Branches feel that both articles point to two separate but equally important aspects of the DFS industry: where the industry currently is and, perhaps more importantly, where it’s going.
For anyone involved/interest in DFS, GSMA’s annual report is a must-read and the 2014 addition is no different. GSMA’s report is unparalleled in the scope it offers and is very helpful at providing a global market overview. In 2014, GSMA reports that there are 255 mobile money services in operation across 69 countries, as well as being available in over 60% of developing markings. A few further highlights of the report:
· Bill disbursements, bill payments, and merchant payments represented 23.1% of all value processed through mobile money systems in December 2014
· Over 60% of mobile money providers have made their services available through smartphone apps
· In three-quarters of the markets where mobile money is available, agent outlets outnumber bank branches
· In 47 out of 89 markets where mobile money is available, regulation allows both banks and non-banks to provide mobile money services
It is a belief among many practitioners who contribute to Banking Beyond Branches that merchant payments is the next great frontier in DFS. The emphasis upon this aspect of DFS has been stressed by the big companies that have entered through their own mobile wallets: Google (through their Android Platform), Samsung, and, most notably, Apple – this, of course, is not an exhaustive list with MCX and PayPal also involved. So, in a market where all competitors are entering and making their value proposition, what’s the difference between them all? What, for instance, can I do on my iPhone that you can’t do on your Samsung Galaxy? The below article examines that, categorizing the strengths and weaknesses of several m-wallets. As with any technology, updates/tweaks/improvements are inevitable. However, with Apple Pay now being accepted at over 700,000 locations and the recent updates/entry of both Google and Samsung, the competition over m-wallets promises to be an exceedingly competitive one.