MWC 2010: A Mobile Money Ecosystem Starting to Emerge
Popular conference track on Mobile Money in Barcelona.

Mobile money has been a hot topic the past year with new solutions and pilot projects introduced at a high pace. Mobile money refers to a set of financial services carried out from a mobile handset and includes for instance mobile payments, mobile money transfer and mobile banking.

Due to the complexity of this type of services they require a complex ecosystem comprising players from both the telco industry as well as from the banking industry at the same time as regulatory authorities need to be involved. The GSM Association has initiated a number of different projects with the aim of creating a viable ecosystem and to accelerate deployments. At the Mobile World Congress in Barcelona, the GSMA took the opportunity to further promote mobile money services and get all the players together by selecting mobile money as one of the main tracks for the conference and devoting a one-day long session on the topic.

When the doors to the session were opened early Monday morning it appeared that mobile money will be a hot topic in 2010. The hall was soon crowded by people representing all parts of the value chain, showing great interest in the theme. Judging from the discussions, the buzz is growing around NFC in the developed markets whereas mobile banking and money transfer for the unbanked population is a highly prioritized area in developing markets. The latest initiatives from the giants Visa and Nokia reflect the great belief the industry has in these services.

Besides announcing a collaboration with technology provider DeviceFidelity that aims at accelerate NFC usage, Visa also participated in a pilot that offered 400 lucky congress attendees to try NFC during the congress. Handsets from Samsung were equipped with NFC functionality and loaded with € 60 in airtime and € 75 that participants could spend at over 30 merchants’ locations around the congress. The project was the result of cross-industry collaboration between GSMA, Samsung, Telefónica, Visa, Giesecke & Devrient, Ingenico, ITN International and La Caixa.

Nokia announced its first commercial pilot launch of Nokia Money where the company has teamed up with YES Bank in Pune, India. The solution is based on Obopay’s platform and aims at creating a multi operator and multi bank approach on an international level. Most successful deployments today are launched by a single operator on a specific platform, limiting the scope for interoperability. The uniqueness with Nokia money is that it is launched by a major player outside the operator sphere and at the same time having an open approach. A mass market adoption of mobile money services could bring a significant group of people into the mainstream economy and thus change their lives.

What’s interesting at this point is the fact that an ecosystem is emerging and that the major players are moving into the mobile financial services sphere. The huge interest in the seminars and the fact that even regulatory authorities were represented show that it is just a matter of time before these services will gain significant traction. An interesting issue still needed to be resolved is how to share the profits. The services compete against traditional payment methods such as cash and credit cards, which would set an approximate possible revenue level. With a large ecosystem comprising banks, operators, handset vendors, platform providers, payments providers there will be many stakeholders who want a piece of the cake.

Marcus Persson

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