Ignacio Mas and Daniel Radcliffe of the Bill & Melinda Gates Foundation have a new paper summing up the early experience with M-PESA – Mobile Payments Go Viral: M-PESA in Kenya:

M-PESA’s market success can be interpreted as the interplay of three sets of factors:

* Pre-existing country conditions that made Kenya a conducive environment for a successful mobile money deployment;
* A clever service design that facilitated rapid adoption and early capturing of network effects;
* A business execution strategy that helped M-PESA rapidly reach a critical mass of customers, thereby avoiding the adverse chicken-and-egg (two-sided market) problems that afflict new payment systems.

As more people use electronic means to connect to each other, fewer use the post office. Media reports suggest the Bangladesh Post Office is taking a ‘if you can’t beat them, join them’ approach when it comes to mobile phones -  Bangladesh Post Office introduces mobile money transfer April 19:

The country’s post offices once used to deliver around 4.5 million money orders every year, but the figure dropped to 2.8 million last year due to mushrooming of ‘illegal’money transfer systems, according to analysts. The private courier service operators have already outperformed the postal department in delivering letters and parcels as the state-run
offices have failed to do the job up to the expectation. The BPO DG said the mobile money transfer facility would revamp the moribund postal department, which sees sharp fall in earnings from letter delivery since introduction of mobile phones.

Related – a new mobile money transfer service: Orascom’s Bangladesh unit offers mobile remittance.

The word “innovation” may be a bit overused in the technology world, and “financial innovation” has different meanings for different people, but MasterCard certainly sees a need to try and stay a step ahead of others when it comes to the way we pay for things. Last week the payments firm announced the launch of MasterCard Labs. As a press release says, the unit will be:

building payment advancements and leveraging enhanced time-to-market capabilities to drive innovations through conceptualization, proof of concept, pilot, and support commercialization, in order to deliver additional value to customers and consumers.

I know you’re still reading this because you want to know about the Legos, right? Here you go:

-Jim Rosenberg