Last week a group of the world’s 25 leading medical doctors, public health professionals, development agency staff and analysts gathered in Bellagio, Italy to debate the future of mHealth, or the use of mobile phones in health systems.

This emerging field resembles mobile banking circa 2002. There are uncoordinated and relatively small pilot projects, regulators and policymakers have thought precious little about the topic, donors have no organized mechanisms for support, and there is scant public attention to the opportunities to deliver healthcare or track health information with mobiles. In a previous post, Jim Rosenberg characterized this state of play as the “technology trigger,” the first stage in the maturing of a new technology approach.

Mobile banking has clearly moved beyond that phase – indeed, with regular appearances in publications like the Financial Times, Economist, Wall Street Journal, New York Times, and trade press such as The Banker, mbanking is now farther along the lifecycle towards the “peak of inflated expectations.” (See Jim’s post)

What caused this maturing of mbanking during the past 5-6 years? For one, “mobile financial services” isn’t a new topic and has been hyped before, so we may just be following a pattern. But I’d like to share one theory that I discussed this week with the mHealth experts as they think through how to advance their field. My argument consists of six different reasons.

“Independent Champions”
Starting in 2003-2004, several development agencies started tracking and thinking about the phenomenon mobile phone banking as a means of expanding access to finance. CGAP, DFID, the UN Foundation, InfoDev and others dedicated staff time and funding to write about the first examples and to understand how they could advance this approach. These groups took “ownership” of mobile banking, in the sense that they assumed responsibility for following and responsibly promoting the approach. Because they are neutral, independent players and not beholden to private commercial interests, they have been able to articulate and sustain a vision for how mbanking can benefit poor people. And they have become trusted by important gatekeepers– policymakers and regulators – because of their neutral status.

“What it is, and What it isn’t”
Mobile banking was clearly defined by its early “champions” and therefore a common language was created that allowed various parties to engage in constructive debate. “Transformational” mbanking plus banking agents was set out as the holy grail in expanding access to finance. Key models (bank-led, telco-led, hybrid, etc.) were identified. Mbanking was defined to exclude giving mobiles to microfinance loan officers to collect data, or using SMS text messages for repayment reminders. These parameters allowed MFIs, mobile operators, banks, banking supervisors, and industry observers to hash out appropriate regulation, analyze business models, and accurately compare performance.

“Profit motive”
Big commercial players have seen mbanking as a source of large potential revenue and other measurable financial benefits, such as increased customer retention. We have not yet seen the same excitement about other innovative technology models in the developing world, including mobile health. The key benefit here is that the model is advanced by organizations with the ambition and ability to scale. Moreover, associations of banks and operators may help to promote standards and tools that can expand the number of member organizations that use the approach. The GSM Association, for example, has actively promoted “mobile money transfers,” an application of mbanking, as a profitable service to its mobile operator members. So the potential for profit is great as a starting point, but can quickly create a flywheel effect that perpetuates the expansion of a model.

“Good blocking”
Successful runners in American football usually benefit from teammates who block opponents and create space in which to run. In mbanking, CGAP, DFID, Bankable Frontier Associates and others have played a blocking role by educating regulators about the benefits and risks of mbanking before they instinctively reacted and tackled innovative projects perceived as too dangerous for the public. I know I’m going to get flak for this heavy-handed analogy from colleagues and friends in the regulatory community. But it’s useful in quickly conveying what’s taken place. (In its various flavors, mobile banking subverts at least two banking regulation orthodoxies: that only prudentially supervised financial institutions will hold public deposits, and that banking – read deposits – will only be accepted in bank premises. Mbanking can mean that a mobile operator accepts customer deposits at a prepaid-airtime reseller.)

“The Honeypot”
At CGAP we don’t like to think of ourselves as donors – indeed, most of our project partners will agree that our most valuable contributions have been to help think through project strategy and execution, and sharing of international experience. But I suspect that the “honeypot” we set up with the support of the Gates Foundation – a window to test and financially support a small number of technology and microfinance projects – boosted the number of MFIs, telcos and banks that plan to implement mbanking. After publicly announcing our intent to selectively advise and support technology and microfinance projects – including mbanking projects – we received more than 200 applications, of which nearly one-third could be considered related to m-banking.

“Selling the story”
Finally, the development agency champions for transformational mbanking were successful in packaging what is essential a staid, financial services delivery channel into a human interest story. In national and international media outlets, CGAP, the UN Foundation and others actively promoted research findings suggesting that mbanking could be a lower cost means of giving basic banking services to poor people. By highlighting the “human interest,” or “real-world” implications of new technology through radio interviews on NPR and pieces in publications as diverse as the Economist and India’s ICT4D journal, these groups didn’t just increase public awareness of the issue, but also its perceived importance to strategic audiences such as policymakers and corporate executives.

I think these six factors nicely sum up what’s happened to take mbanking from fringe opportunity to mainstream business model. Do I have a counterfactual to prove that these activities were vital? I don’t. But I wouldn’t suggest that my new friends in the mobile health space do nothing, and give me the chance to make that comparison. Instead I’d encourage them, and others seeking to promote a potentially powerful new model, to do all of these things and more, if it could help poor people improve their lives.