Jim Rosenberg

The 2010 Mobile Money Summit will be held 24-27 May in Rio de Janeiro, Brazil - and as a founding partner of this important gathering, CGAP will be there for the third year running.

The Call for Papers for MMS 2010 is now open. Become a speaker and share your vision at this ground breaking event. We are currently looking for:

• New mobile money presentations/content that has not been presented in the past
• Speakers that have not presented at other events in the past 12 months, or if the content is vastly different than past presentations

Want to know more? Visit http://www.mobilemoneysummit.com/ for updates.

-Jim Rosenberg

More than 170 million poor people worldwide receive regular payments from their governments, but the potential to use these payments to increase financial inclusion is largely untapped, according to “Banking the Poor via G2P Payments,” a new Focus Note from CGAP and the U.K.’s Department for International Development (DFID).

Pioneering programs in Brazil, India, Mexico, and South Africa are providing financial services, such as savings accounts and electronic money transfers, to poor recipients of government transfers. But the Focus Note finds that worldwide fewer than one-quarter of government-to-person (G2P) payments to the poor land in a financially inclusive account—i.e., one that enables recipients to store funds, make or receive payments from other people in the financial system, and is accessible, in terms of cost and distance.

• Read the story
• Download the publication

In case you missed it, be sure to read CGAP’s top ten mobile banking and microfinance technology posts for 2009.

And with that, we jumped into the new year with a glimpse of a new brief by Mark Pickens: Window on the Unbanked: Mobile Money in the Philippines….

The Philippines provides a window onto the complex financial lives of low-income families. Three out of four Filipinos are unbanked (Demirgüç-Kunt, Beck, and Honohan 2008). The country hosts two of the earliest pioneers in mobile money—Smart’s Smart Money launched in 2001 and Globe’s GCASH launched in 2004. CGAP, GSMA, and McKinsey gathered data on 1,042 unbanked consumers in the Philippines, split between mobile money users and nonusers.

Read the rest of this page »

Earlier this month, the Bill & Melinda Gates Foundation (full disclosure - the Foundation co-funds the CGAP Technology Program) announced a suite of grants to “give $38 million to help 18 micro-lenders explore ways to make savings accounts available to 11 million poor people across 12 countries in Africa, Asia and Latin America over the next five years.”  Joyce Lehman is a Program Officer at the Financial Services for the Poor unit at the Bill & Melinda Gates Foundation, and she explains in this interview how the Foundation is trying to foster microsavings with technological innovation.

We hear a lot about microcredit, but very little about microsavings. Why? How will this series of grants try to change that?
Savings is the most neglected financial service available to the poor, and despite what most people may think, the poor do need a safe place to save money. Most microfinance institutions  (MFIs) are non-governmental organizations (NGOs) with a mission to serve the poor, and typically don’t have either the organizational ability or the regulatory status to take deposits. Because the poor save in small amounts, transact frequently and maintain low balances, commercial banks cannot cover the cost of serving the poor through their traditional bank branches, which are expensive to build and maintain.

Read the rest of this page »

In case you missed it, last week my colleague Mark Pickens provided us a quick look at the load of recent Kenyan mobile banking news. And here’s one more story to add: Safaricom, Others Find Pricing Key to Mobile Service Use:

A Strategy Analytics report points out that Safaricom’s M-PESA mobile funds transfer service handles nearly 10 percent of Kenya’s GDP in transactions that average less than $20. Since personal cash flow in emerging markets tends to be very irregular and relatively few consumers can afford to tie up significant sums, purchases of goods and services are often made in small amounts as need arises.

Read the rest of this page »

Recently we caught up with Damdinjav Dorjdamba, the Director of the E-banking Department at XacBank. Based in Mongolia’s capital Ulaanbaatar, XacBank is a community development bank and microfinance institution working to extend financial services to poor and underserved people, including nomadic groups, in both remote and urban areas in Mongolia.  It is providing electronic banking and payment services through a combination of cellphones and cash-handling agents. XacBank is also aiming to create the first nationwide payment system using mobile phones in Mongolia.

How is your mobile banking service faring?
In February 2009, we began piloting mobile banking and payment services in three locations and, the following month, we expanded into more places, including Ulaanbaatar. These pilots, along with several stress tests and focus group discussions with the first users of the mobile banking services, have contributed to the development of the m-banking platform. We went fully live with the commercial launch of our m-banking service AMAR (EASY in Mongolian) in July. By the end of September, the Bank had reached 11,200 clients served via around 1,000 agents.

Read the rest of this page »

Are you the sort of person who likes to visualize data? If so, you should definitely visit the GSMA’s new data mashup on Google Earth: Mobile Money for the Unbanked Deployment Tracking.

The tracker is useful to:

• Track markets with live mobile money deployments
• Assess latent demand for mobile money in each market
• Benchmark approaches to service design and partnerships

CNN looks at the potential of mobile banking to reach the unbanked and gets right to the point - that the real issue is cash:

Imagine your life if you had no access to banks, ATMs, credit cards, or savings and checking accounts — just cash that you needed to hide or carry around. It would be hard to save, plan, get ahead, take chances, or feel secure.

The insanely influential US tech sector website TechCrunch asks, “Is the Internet Finally Robbing the Greedy Financier’s Gravy Train?”

The most amazing thing about the Internet is how many industries it’s wrecked. File sharing and iTunes forever changed music’s economics; blogging and other forms of online content have killed old media; and open source and software-as-a-service have brutalized the expensive, on-premise enterprise software products…Here’s the second most amazing thing about the Internet: The fact that there are still industries it’s barely touched. One of those is finance.

Ignacio Mas of the Bill & Melinda Gates Foundation has a new paper out - posted to the Microfinance Gateway:

Savings help poor people cope with life cycle family expenditures and shocks. Only about one quarter of households in developing countries save with formal banking institutions. Large commercial banks find it too costly to reach out to the poor with savings products, and poor people, in turn, do not trust commercial banks.

If anyone doubts the ascendancy of the mobile phone and social media when it comes to people connecting with each other, here’s a story that perfectly demonstrates how social marketing and mobiles can play a positive role, $10 and one text message at a time: “Mobile donations to Haitian relief top $7M.”

Americans have donated more than $7 million to relief for the earthquake in Haiti via text message, according to the Mobile Giving Foundation, including more than $5 million to the American Red Cross.

-Jim Rosenberg

In 2009, CGAP teamed up with the GSM Association (GSMA) and McKinsey to measure the global market for financial services delivered via mobile phones (mobile money) in 147 developing countries. This is the first study of mobile money and the unbanked—those without access to formal financial services—estimated to be almost 4 billion worldwide.

The Philippines provides a window onto the complex financial lives of low-income families. Three out of four Filipinos are unbanked (Demirgüç-Kunt, Beck, and Honohan 2008). The country hosts two of the earliest pioneers in mobile money—Smart’s Smart Money launched in 2001 and Globe’s GCASH launched in 2004. CGAP, GSMA, and McKinsey gathered data on 1,042 unbanked consumers in the Philippines, split between mobile money users and nonusers.

Download Window on the Unbanked: Mobile Money in the Philippines

Members of CGAP’s Mobile Banking and Microfinance Group can also request an in-depth toolkit with which they may replicate this analysis in their own market(s).

-Jim Rosenberg

At CES, normally known more for its glam-flash cool gadgetry than calls to action to improve the lives of the poor, Nokia has announced a million dollar challenge grant to get mobile application developers to do well while doing good:

Dubbed the Growth Economy Venture Challenge the competition will will include both hardware and software idea and the winning idea will be judged by a panel of Nokia staff and private venture capitalists. The winning criteria is that the idea should improve the lives of people earning less than $5 per day.

Also at CES, Qualcomm laid out a slightly different vision for mobile payments, as the San Diego Tribune reports:

Wireless-chip giant Qualcomm expects to launch a wireless-gift-card-and-transaction service late this year called Swagg, another step toward the San Diego company’s ultimate goal of having cell phones replace credit cards and become a mobile wallet for consumers.

The past few weeks have seen a pile-up of stories about India and mobile banking:

• Inclusive banking via cellphones
• Convenience, safety draw people to mobile banking
• RBI revises mobile banking norms

Though in India, not all branchless banking news is about mobile phones, as this headline alone tells us: ICICI-First Data look at 500,000 PoS terminals by 2015.

And finally, if you prefer your news in fortune-cookie sized snippets, be sure to read A Look at Mint’s Twitter Aggregation Site: Money Tweets (and if you think tweet isn’t a word, then may I humbly suggest you read this).

-Jim Rosenberg

We’re taking a couple of weeks off - but we’ll be back in 2010 with more of your views on mobile banking, information systems, and the countries and organizations that are working to make appropriate financial services available to poor people everywhere. Meanwhile, here are the ten most-read CGAP Technology Blog posts for the year….

Read the rest of this page »