Archive for: Presentations

Nobody gets up in the morning and says “I want an efficient payment instrument today.” Nope. But they might say, “I really want that Hello Kitty lunchbox.” Several clicks, and its yours. There’s a lesson here: what will be desired by BOP consumers, whose tastes might run a little different from the typical American nerds? And how can the incipient mobile money industry tap into that? Is there a metaphorical eBay out there?

That’s why I was so excited to talk, and listen, at last week’s huge mHealth Summit. For those of us in mobile financial services, it may just be that adjacent industries like mobile health drive demand for mobile money through their understanding of what BOP consumers want. Vaccinate your kids? There’s an app for that, and a way to pay for it. If this report is even half right, there could be tens of millions of mhealth clients needing efficient, convenient, safe ways to pay in the not too distant future.

Here’s my presentation from the Mobile Money meets Mobile Health session of the Summit.

- Mark Pickens

In 1968, a film titled “Planet of the Apes” captured the dystopian mood of the time by vividly telling the story of an astronaut who gets lost in space for many years, and eventually crashes on a strange world where apes, not men, are at the top of the food chain. The main plot twist comes when the astronaut finds the buried head of the Statue of Liberty, and realizes he is not on another planet, but rather, is on a post-nuclear-holocaust planet Earth – many years in the future. Everything mankind took for granted is gone. Humans are relegated to a life of servitude, subordinate to the super smart race of apes that has come to rule the planet.

This week at the Mobile World Congress has felt a bit like a live-action version of “Planet of the Apes,” with a few differences. Instead of apes, we have apps. The species rising to power goes by the ticker symbols of GOOG (Google), YHOO (Yahoo!), APPL (Apple), though some telecom wags seem to think these are simply four letter words.

On Planet of the Apps, the species running in fear are the mobile network operators.

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This week we’re blogging from Barcelona, site of the Mobile World Congress. Today is the second full day of focus on mobile money, where the GSMA’s Mobile Money for the Unbanked working group convenes market players to compare notes. CGAP Microfinance Specialist Mark Pickens is presenting the latest work we’ve been doing on agents.

• Download the presentation comparing agents in Brazil and Kenya

Industry actors say their biggest unknown is how to build a viable network of branchless banking agents. Over the next 3 months, CGAP’s Technology Program will analyze agents in 3 reference countries (Brazil, India and Kenya). Because this area is so new, we will be out in the field ourselves talking to agents, network managers and banks.

We’ve already begun in Brazil, where CGAP is partnering with The Center for Microfinance Studies at FGV (Fundação Getulio Vargas), the leading Brazilian business school. Planet Finance Brazil is also a partner in the field research. Data was gathered on 295 agents, 49 of which were interviewed in-person. Read more about this collaboration.

-Mark Pickens

Next: A round-up of mobile banking developments from the Mobile World Congress.

Today, the CGAP Technology Blog comes to you from the Mobile World Congress in Barcelona. The MWC is the world’s biggest business show for all things mobile related. In recent years we’ve noticed how the focus on mobile banking has slowly grown on the agenda – both in the conference itself, as well as for the mobile network operators who comprise the membership of the GSMA.

Just two years ago, mobile money was relegated to a side session of a few hours. This week, there’s two full days of mobile money content – starting with Monday’s panel of the so-called “two billion club” – the handful of mobile operators who combined reach one third of humanity with their cell coverage.
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6 months + 200 technology and finance leaders from 30 countries = four scenarios of branchless banking for poor people in 2020.

Yesterday we held a special webcast discussion of the CGAP/DFID Branchless Banking Scenarios 2020 Project and Focus Note.

Watch the video – Branchless Banking Scenarios for 2020

Here’s the line up of speakers, and the scenarios:

Setting the scene: the forces shaping branchless banking

• Stephen Rasmussen, Manager, CGAP Technology Program
• Elizabeth Littlefield, CEO, CGAP

Scenario 1: Bharatia, presented by Mark Pickens

• Moderator: Robert Annibale, Global Head of Microfinance, Citigroup
• Brian Richardson, WIZZIT
• Abhishek Sinha, Eko
• John Staley, Equity Bank

The Bharatia scenario is a story of how changing customer needs, growing competition, an evolving regulatory environment and technological innovation could combine to shape a positive business and financial inclusion outcome in 2020.

The scenario examines the impact of a new player in the market and how a competitive and crowded marketplace for bill payment services stimulates a new wave of innovation.  In the case of Bharatia, the opportunity space they identify is the Self Help Group (SHG).  Through the creation of a mobile phone delivered accounting system, they not only deliver significant benefits to SHG members, but also create the means to connect the informal sector with established financial institutions, providing opportunities for the SHG to access a wider choice of loan and investment products and services.

Scenario 2: Telmar, presented by Sarah Rotman

• Moderator: Peer Stein, IFC
• Abbas Sikander, Tameer Microfinance Bank
• Aishath Haifa, Maldives Monetary Authority
• Rizza Maniego-Eala, Globe Telecom

The Telmar scenario is a ten year story of how sequenced and proportionate regulatory responses along with the strong commitment and support from the government and international donors, enable two established players – a bank and MNO -  to shape a positive business and financial inclusion outcome for the small post conflict society of Telmar.

Closing remarks

• Daniel Radcliffe, Bill & Melinda Gates Foundation
• Mavis Owusu Gyamfi, Head of Profession, Private Sector Development, DFID

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Just over a year ago in Cairo, we convened the first Mobile Money Summit with our friends at the GSMA, DFID and IFC. The diversity of the crowd was fantastic – people from all over the world and all sorts of business – from mobile network operators to vendors to financial institutions. It might sound corny, but Hannes Van Rensburg captured the mood quite well: “A general spirit of: ‘Let’s build the industry’ rather than criticise each other prevailed.” (Mobile Payments have arrived)

Today’s the second and final day of this year’s Mobile Money Summit, and the key words here are data and partnerships:

Data - around the market opportunity for mobile money – by the year 2012 CGAP and GSMA estimate there will be 1.7 billion people with a mobile phone but not a bank account and as many as 364 million unbanked people could be reached by agent-networked banking through mobile phones;

Partnerships - a slew of deals announced yesterday illustrate the momentum around mobile banking services, notably: Visa Launches First Commercial Mobile Payment Service in Latin America. Read the rest of this page »

To promote effective regulation of mobile banking, CGAP, DFID, and the Alliance for Financial Inclusion (AFI) have organized this week’s second Global Leadership Seminar for high-level policymakers and regulators who set policy for branchless banking, including mobile banking. CGAP’s Technology Program and AFI are supported by the Bill & Melinda Gates Foundation. The following is based on a session led by Anu Bajaj, Adviser, Financial Sector Team at DFID. You can download her presentation here.

CGAP and DFID are collaborating on work that explores how social welfare payments – government to person (G2P) transfers – could help to bring poor people into the formal financial system using branchless banking:

Until very recently, most G2P (government-to-person) payments were carried out in person and in cash. However, because such methods pose security risks and require high transaction costs for payers and beneficiaries, governments are increasingly switching to electronic delivery.

Government payment systems vary widely by country. Plan Familias in Argentina, for example, offers a debit card re-loadable only by the government. Funds must be drawn within 1 month or the beneficiary loses them, and they may not deposit additional funds into the prepaid account. In Brazil, the Ministry of Social Development is in the process of migrating 12 million recipients of Bolsa Familia, the financial program that represents 25% of Brazilian families, away from an electronic benefit card, and toward the option of a simplified account. In South Africa, several million of the country’s more than 9 million grant recipients receive their funds via a debit card from the nation’s largest bank or a smartcard from payment system provider Net1 UEPS Technologies.

While there’s been some exploration of the business case for agents and providers, we wanted to look at the implications for decision makers. Key takeaways:

• Some schemes may require specific regulatory approval or exemption to actually increase access to banking services;
• Social welfare departments may require or benefit from financial advice in designing payment elements and even appointing payment agencies (e.g. banks);
• Large scale schemes may affect payment system and financial sector through choice of standards and instruments;
• The current economic climate offers opportunities for a “big push forward” for financial inclusion with multiple developmental and economic growth spin offs;
• Financial regulators can enable and support this process through constructive engagement.

In this session we asked for a show of hands – how many banking and payment officials in the room have reached across department lines to speak with their social welfare departments to see how they could collaborate? Only a few hands went up, with this comment: “Dialogue doesn’t equal agreement.”

DFID and CGAP will have a Focus Note on this topic in the next few weeks.

Around the globe, mobile banking can bring low-cost financial services to millions of people, especially in developing countries where banking services are not readily available. It also has enormous potential to open new markets and business opportunities for organizations that can facilitate and advance it. The GSMA Mobile Money Summit 2009 will provide the insights, solutions and connections to make the most of this global phenomenon.

The second annual GSMA Mobile Money Summit will be held at Fira Montjuïc in Barcelona, Spain on 22-25 June 2009. The event will bring together senior executives from financial services institutions, mobile network operators, development organizations and solutions vendors, as well as regulatory and policy makers. The program will provide a comprehensive demonstration of the addressable markets, a showcase for new solutions, and a forum for sharing key success factors and lessons learned from around the world. The GSMA Mobile Money Summit 2009 will stimulate greater understanding and collaboration between all mobile money stakeholders globally, regionally and locally.

Last week was the gigantic GSM Mobile World Congress in Barcelona. At the Mobile Money Forum, optimism ran fast and deep. That tone was a refreshing break from the steady tide of gloom and doom in the financial press. Safaricom won another award for its M-PESA mobile money service, which has now signed up over 5 million Kenyans.

There was also lot of congratulations for making it possible for people the world over to buy airtime in amounts as little as 5 cents from literally millions of sellers in the smallest villages. One commentator called it “the cheapest, biggest, most powerful sales channel in human history.” The mobile industry thinks they have a huge advantage in delivering financial services cheaply.

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As promised, here is the video and presentation from today’s webinar that Kabir Kumar and Ignacio Mas lead, based on their recent paper: Banking on Mobiles: Why, How, for Whom?

Thanks to all of you who joined us in person or online.

Presentation: CGAP Mobile Banking Webinar (881kb pdf)

Video: CGAP Mobile Banking Webinar (requires RealPlayer)

Background
The promise of mobile banking is well known; harder to find are examples of solid implementation and mass roll out beyond payments and transfers. In Banking on Mobiles: Why, How, for Whom? CGAP examines the business case and deployment options for smaller banks and microfinance institutions. With effective partnerships and technical choices (which affect customer uptake), we believe there is a strong market opportunity to reach poor people with a broad range of financial services.