Mobile Banking

[Decadent Ambition]

Salam all,

 

I have been doing a research on Mobile banking and cannot seem to understand how the conventional banking sector can use mobile companies (who provide virtual money transfer) as tools for expansion, especially into the rural un-banked market?

 

To my knowledge of mobile banking or wallet money as they call it, do not require users(mobile phone users with this value added service) to setup a bank account, instead offering a variety of services; from money transfer, mobile payments and balance checking to mobile purchases, and the ability to buy airtime in real-time.

 

Heck some mobile phone operators with the help of ATM Vendors have taken money transfers a step further. Now a mobile wallet user can basically withdraw money from an ATM without essentially having a debit card. This is kinda unique in the sense it allows a mobile wallet user to come and access the ATM without the need for a bank card. It works like this, a customer gets an authentication code on his phone. Walks up to an ATM, pushes the button, enters the authentication code on his cell phone and basically withdraws cash. This is fantastic in the sense it opens up real world banking infrastructure to the virtual world of mobile money transfer.

 

Sorry about the details as I felt it maybe needed to explain my earlier question which I'll re-write again being how does this help the conventional banking sector expand? To me I see it as a direct competitor? How do they aid one another and mobile wallet offered by mobile phone carriers become an inclusive product to help expand banking facilities especially to the un-banked population in developing countries.

 

I am specifically interested in how can they look at it as a tool for expansion and increasing their distribution?

 

I can't seem to get it, even though I know its easy walahi, mise waan waashay.

Please Help folks. Thanks

[FatB]

?????

[Decadent Ambition]

huh. Fatboy are you alright dude? Ma summerkii iyo baruurtii aaku dhibtay adna?

 

Any other takers. Camon' folks I need help here.

[nuune]

Now a mobile wallet user can basically withdraw money from an ATM without essentially having a debit card. This is kinda unique in the sense it allows a mobile wallet user to come and access the ATM without the need for a bank card.

It is not a new technology, it is being used by some countries for many years, though it is being described as a stupidh invention, because you still need to stand in front of the ATM machine messing with your mobile phone to withdraw money, inserting your debit card would beinb easier ten times!!!

 

 

To my knowledge of mobile banking or wallet money as they call it, do not require users(mobile phone users with this value added service) to setup a bank account,

You cannot use the technology without having a bank account, the transfer feauture will need you to have a bank account to get the money from and to, to buy airtime needs also to have a bank account in hand, so as any other services u wana use on da mobile.

 

 

It is not a competetion, it is the banks themselves making things easier for customers to do their daily life and so on, also the mobile phone service providers get their share of profit from the banks since they are handling the technology, it is the banks though which provided the software programmes to run on the mobile phones, and mopbile service providers charge the banks to carry the job.

 

 

That is another angle I looked at it!

[Decadent Ambition]

Thanks nuune but sxb in one scenario I know of, Safaricom of Kenya and their M-Pesa money transfer service one does not need have a banking account to use their service and they are giving the conventional banks a run for their money. I was specifically interested how in this case they help expand banking facilities for conventional banks. Safaricom's rural clients, even urban resorted to using their system as a virtual bank. I am told clients there are able to deposit money through any safaricom mobile wallet kiosk and either transfer or store it in their phone, later to be able to utilize or transfer. Is this a unique scenario only with Safaricom? Would you know of others like that in both developing and developed world? Could theirs be a scenario in which they are capitalizing on the weak and outdated banking bylaws? Implication if such customized mobile wallet system were adapted by EU telcom power house like telefonica for EU regional mobile money transfer?

Discuss

[nuune]

Sxb, good analysis, the scenario you mentioned about Safaricom is quite simple sxb, I know of this in existance, take for example a top up credit card, you probably heard of this service, it is different from bank credit cards, and banks have no control over it, usually you just top up this card(which u signed up) by whatever amount of money you want(there is ofcourse maximum allowed), and you get 16 digit visa credit card number with expire date and secirity code(similar to normal credit card, visa or mastercard etc), the freedom of this is you are not associated with any credit card company or bank.

 

 

So Safaricom customers, they usually deposit money in any safaricom kiosk as you said, the top up credit card is more convenient, you can top up anywhere you like and fill ur virtual credit card which will have all the features that a normal credit card will have, the top up card though charges small fee when depositting money in it, about 2 Euro or less than 2 dollars.

 

 

That si one example about the virtual bank/credit cards etc.

 

 

I am not aware, or haven't heard or seen, where this new thing is capitalizing on the weak and outdated banking bylaws!

[Decadent Ambition]

Nuune appreciate the prompt reply sxb. You're right on safaricom's mobile wallet being virtual bank/prepaid credit card.

In fact this morning sent an email to Fundamo, a South African Mobile Financial Platform. Theirs is more geared towards expanding and helping banks penetrate rural region and asked them if they could develop a customized virtual bank ala safaricom type for me to which they replied immediately NO.

 

How much would you say an M-Pesa look alike software platform will cost?

[nuune]

Lii-Ka Shing, all I know is the M-Pesa was developed in the UK, and Vodafone company provided the software platform for Safaricom, this is to say that, Vodafone earns their share of percentage of every transaction or depositted money, and that percentage is not a small one.

 

 

Maybe it is an idea needs to be transported to other parts of Africa, I heard Somaliland Telecoms are thinking of similar service as of that of M-PESA.

 

 

I don't think South Africa will appreciate such services, maybe they are using advanced systems than that of safaricom, and the other thing is, their banking sector is way too ahead as dat of Kenya which strugles to have customers, the largest bank in KENYA got only one million customers.