Mobile Money, growing users in emerging markets

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The number of users using mobile money systems (money via smartphones) in emerging markets will exceed 1.2 billion in 2025. This share will rise from today’s 980 million, accounting for 30% of all mobile phone users in emerging markets.

This is revealed in a report by Juniper Research.

Growth will be driven by the use of P2P and payment systems. But for this to happen, financial system providers such as banks, for example, need to partner to offer products that are sophisticated and therefore attractive.

Nick Maynard, one of the authors of the research, explains:

„The strong position of mobile money providers is threatened by the growth in financial literacy and smartphone penetration. Mobile money services must evolve rapidly, otherwise they lose importance. The platform-based payment model offers the opportunity for mobile money providers to become „super apps“, and agreeing partnerships now will be key to achieving this goal.

According to the research this could only be a first step, because afterwards users could learn how to use microfinance systems like this:

Microcredit;
Microsaving;
Microinsurance.
Research estimates that users of these services will grow from 227 million today to 336 million in 2025.

The more competitive the market becomes, the more providers will want to offer better services beyond simply sending and receiving money. Analysing user activity data will be critical to understanding user preferences and developing the best products.

What is mobile money
Mobile Money is the system that allows users to receive, store or spend money directly via smartphone. In an even broader sense, Mobile Money also means the control of one’s own money via smartphone. Mobile Money also includes the control of your current account via home banking app.

Mobile money is also referred to when using smartphone payment systems. (such as GooglePay or ApplePay). A similar service is for example WeChat Pay.

Mobile Money systems are very effective especially in emerging economies where unbanked people, who do not even have a bank account, live.

One of the first mobile money systems was MPesa. It was born in Kenya from Safaricom, a mobile company affiliated with Vodafone, and allowed you to send money via mobile phone, transforming the mobile phone connected to a sim card into a wallet. The service has since expanded into other markets.

Since 2007, the year MPesa was founded, the world of Mobile Money has been evolving, and as research shows, it is destined to grow further.

Translated with www.DeepL.com/Translator (free version)