1. Mobile Financial Services
Mobile Monday Norway
6th December 2010
Thomas Bostrøm Jørgensen
Business Advisor
+47 92032078
thomas.bostrom.jorgensen@gmail.com
2. Credentials
CEO, Luup from 2006-2010
Luup is an international leader in domestic and
cross-border mobile payments
Key achievements:
Built a successful B2C mobile- and online payments
business in UK and Germany
Redefined the company strategy from B2C to B2B
Expanded sales organisation to cover Europe, Middle East
and Asia.
Secured global strategic partnerships with Deutsche Bank,
and MoneyGram.
Recruited and built a world-class executive team based on
top talent from organisations like MoneyGram, RBS, IBM,
Visa and Mastercard.
Raised a significant amount of capital from existing to fund
the international expansion
Speaker at key industry event like MMT, IPS, Financial
Services Club etc.
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3. Market drivers
Mobile payments
opportunity driven by
7 billion by continued growth in mobile
2015 phone penetration
Mobiles provide a new
channel for banking,
payments & transfers with
greater reach than
traditional bricks & mortar
locations.
90% of the world’s
population has network
coverage & 60% has a
mobile phone.
By 2015 total number of
mobile phones estimated to
180k 500k 650k 1m 25m 4bn be 7bn.
Of these subscribers in
MoneyGram Bank Post Mobile
ATMs POS 2015, 1.5bn are expected
branches Offices phones to be using their phones as
a banking tool.
With an estimated 7 billion mobile phones in use by 2015, traditional payment providers
are now moving aggressively into the mobile payments space
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5. ... and the mobile payments market?
Recent survey predicts the value paid by mobile to surpass $500 billion by 2015
Source: Edgar Dunn & Company Forecasts 2009
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6. However …
The mobile payments market has proven to be elusive…
Source: Innopay, Mobile Payments 2010
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7. The 4 Market plays
Developed Countries Less Developed Countries
Banked
Making mobile part of the
Leveraging and leapfrogging
economic fabric
These plays influence....
Propositions
Technology
Ecosystem structure
Ecosystem players
Unbanked
Bringing all into the locally
advanced financial Economics Social and economic
inclusion
system
8. Less developed countries
2 billion people unbanked
Estimated 215 million migrant Global remittances in 2008 totalled
workers worldwide (3% of world pop) $305bn
Over 2.5 billion people under-banked India remittances received
(2008): $45bn
Africa remittances
received (2008): $31bn
South America SE Asia remittances
remittances received Over 4 billion mobile phones in use
received (2008): $60bn
(2008): $57bn
Remittances to developing countries
totalled $247bn in 2008
Unbanked and migrant populations driving demand
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9. The developed world demands convenience
55% of mobile banking users
have smart-phones
Mobile banking services primarily
used by 20-34 year olds – Generation Y
57% of m-banking users see convenience &
anytime access as primary usage driver
90% of phones in Japan
have NFC capabilities
Sources: CheckFree survey, Yankee Group Research World Bank
Mobile enables anytime, anywhere value-add services
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10. Mobile Financial Services - ecosystem
Mobile Network Banks
Operators
Original Equipment Money Transfer
Manufacturers Organisations
Schemes / Payment
Government Sponsored Customers and Service Providers,
Organisations Merchants SIs, BPOs
Non Government Micro Finance
Organisations Companies
Mobile Financial Solution
providers
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11. Dominant
Dominance of the Mobile ecosystem Following
Developed Countries Less Developed Countries
MNOs Banks MNOs Banks
OEMs OEMs
Banked
MFSs GSOs
MFSs
MNOs MFSs MNOs GSOs
OEMs NGOs MFIs
Unbanked
GSOs OEMs
Banks MTOs
MFSs
MNOs are in the driving seat –banks lag, and are vulnerable
12. Live services and solution providers are emerging globally
European live services South Asia live services
Americas SP Deutsche Bank Europe SP Barclays “Hello Money”
Monitise NatWest Luup Obopay
Fundamo M-Pesa (Safaricom) Monitise mChek
Mcom (Fiserv) Caisse d’Epargne Paybox (Sybase)
Paymate MoBank Mi-Pay
M-Foundry Beem Macalla
Visa PayWave Asia SP
Luup
Fundamo
Paymate
Mcom (Fiserv)
Americas live services
Obopay
JP Morgan Chase
Bank of America
PayPal Mobile S.E. Asia live services
Jibun Bank
Globe Telecom (GCash)
Western Union
SK Telecom
Africa SP
Mi-Pay
Fundamo Africa live services Middle East SP Middle East live services
Paybox (Sybase) M-Pesa (Safaricom) Luup NBAD
Fronde Anywhere Zap (Zain) Fundamo National Bank of Kuwait
Beem Mi-Pay
Paybox Zap (Zain)
Western Union Globe Telecom GCash
Orange Paybox
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13. The industry is maturing
Benefits Potential
Consolidation
Industrialisation
Proliferation
Proof of Concept
Socialisation
Time
14. Mobile Financial Services – what are they?
M-banking M-commerce M-payments
P2P payments
Account balance Contactless
Payments Remittance services
Mini-statement
Smart transit Mobile wallet transfers
Account limit alerts
Merchant Mobile airtime top-up
Account transfers payments by SMS
Bill payments
ATM/branch locator Event tickets
Loans and insurance
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15. Mobile Banking:
Shinginko Bank – the world’s first mobile-only bank
Personalised banking services
Full banking services:
Account opening
Yen deposits
Funds transfers
Loans & insurance
Mobile payments
Targets Generation Y customers
Changing the face of banking in Japan
Won the Best Core Banking Project Award
2008 – Asian Banker
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16. Mobile Commerce:
MoBank – capitalising on the call for convenience
MoBank is a mobile banking service,
which allows users to pay for purchases,
check balances.
The user can register one debit or credit
card (Maestro, MasterCard, Visa or Visa
Debit) to the MoBank account.
The user needs to install a free
application on the mobile phone in order
to be able to use MoBank
Enables mobile purchases of:
Train tickets
Books
DVDs
Event tickets
Fast food
Generates revenue through commission
on purchases
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17. Mobile Payments:
M-Pesa – capitalising on the unbanked value chain
Safricom, Vodafone’s Kenyan subsidiary, offers an SMS-based payment and
money transfer service
Based on SMS and pre-paid accounts.
Through M-PESA a user can deposit or withdraw money, transfer money to another
M-PESA customer or send money to a non M-PESA customer, buy Safaricom
prepaid airtime and manage the M-PESA account.
In December 2008, Safricom announced an extension of the service with UK-Kenya
remittances in cooperation with Western Union.
11.5 million previously unbanked customers (over 40% of Kenya’s adult population)
30% of users save money in their M-Pesa account
Understand the potential for disintermediation
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18. Mobile Payments:
M-Paisa - Mobile Microfinance
Vodafone and Afghan mobile operator Microfinance
Roshan have launched M-Paisa for microcredit, savings, insurance,
microfinance institutions. money transfers, and other
In a country where 36% of its people financial products targeted at poor
live below the poverty line, Afghanistan and low-income people
is the poorest country in the world $25 billion currently at work in
outside Africa microfinance loans & 20 million
microfinance accounts globally
It also has a 40% penetration rate of 12
India - 188 million accounts (18%
million mobile subscribers out of a of population)
population of 30 million
Latin America and Caribbean - 14
M-Paisa is based on an IVR service million accounts
which will enable greater use of M- Africa - 27 million accounts (4% of
Paisa by consumers who might population)
otherwise be excluded due to high
illiteracy rates in Afghanistan
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19. Mobile Payments:
Osaifu-Ketai – an NFC success
Osaifu-Keitai, literally meaning "Wallet Mobile", is a trademark of NTT
DoCoMo, which developed the system.
It refers to the mobile phones integrated with Sony’s Mobile FeliCa ICs, as
well as the services provided by the applications on these phones.
Although it is developed by NTT DoCoMo, the system is also supported by
other MNOs, making it the de facto standard mobile payment system in
Japan.
Osaifu-Keitai services include electronic money, identity card, loyalty card,
fare collection of public transits or (including railways, buses and airplains),
or credit card
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20. Current headlines point to the future
NAIROBI, Kenya, Dec 2, 2010 - Financial institutions plan to leverage on mobile
money transfer technology to enlist more Kenyans in the formal banking system
New York, Nov 16, 2010 - AT&T Mobility, T-Mobile USA and Verizon Wireless
today announced the formation of a joint venture chartered with building ISIS™, a
national mobile commerce network that aims to fundamentally transform how
people shop, pay and save
India, Dec 1, 2010 - Nokia Stores To Serve As Banking Correspondents For Union
Bank of India’s Mobile Payments
Australia, Nov 26, 2010 – Mobile payments taking off. PayPal reports that this year
mobile payments took off in Australia
California, Nov 18, 2010 - Google CEO Eric Schmidt revealed that upcoming
Android devices would include support for something called Near Field
Communication
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21. In summary
Mobile Financial Services are getting foot-hold everywhere
Roll-out is faster and take-up is higher in less developed
countries because if offers the users greater value
Developed countries will see mass take-up and usage with
NFC (driven by next gen iPhone and Android?)
Mobile operators are leading the way and banks are lagging
The future is mobile!
Thank you for listening!
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