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2. Mobile Financial Services & Wallet Wars
Opportunities or Threat
Deepak Sachdeva
Sales Director – Russia & MEA
MoreMagic, an Oberthur Technologies company

3. Agenda
•
Mobile Financial Services & Wallet Wars: Opportunities or threat
– Economic viability of financial series for the unbanked
– Benefits of interoperability
– Challenges faced by banks and mobile operators
– Mobile Payment Gateway: A solution to address interoperability challenges
– Banks and mobile operators collaborative models
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4. Mobile Financial Services are here from last 6 years…
•
Started 6 years ago with pioneers MNOs in Africa and Asia
•
Leveraging gap between ubiquity of mobile phones and low
access to banking services
•
Over 200 live initiatives. 30m active users (1) and many projects
with 1m+ registered customers (1)
•
520,000 registered Mobile Money outlets in the world: same as
Western Union (1)
•
Customer value management impact for MNOs: increased ARPU
up to 20% as well as increased stickiness….
1. GSMA, 2013
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5. ...but results vary a lot and lack key elements
Service penetration
•
•
•
•
Ecosystem challenges
Technical instability
No interoperability, no open loop
Missing key basic banking
services: merchant payment,
loans, savings, insurance
Sprinters
•
•
•
130+
initiatives
60+
initiatives
10-15
initiatives
National successes with mass
market adoption
P2P, top up and bill payment
as killer applications
Uganda, Kenya, Pakistan,
Philippines, Rwanda,
Tanzania, Haiti
Slow growing
To soon to tell
•
•
Launched 6-9 months ago
Limited promotion at start
to secure technical stability
and distribution set up
•
•
•
Launched 1-3 years ago
Penetration below 5%
No mass market reached
Maturity
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6. Wallet Wars…few examples
Nigeria (19)
© Oberthur Technologies 2013
Uganda (07)
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Kenya (05)
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7. Are unbanked population getting benefited from
Wallet Wars?
•
Do unbanked population have easy access to financial services?
–
•
Does a unbanked person can cash-in or cash-out its wallet from any agent location at min. fee?
–
–
•
Does that agent needs to be from same wallet scheme provider?
How many merchants are allowed to accept payments from other wallet scheme providers?
Can he transfer money for his friends and family of other scheme providers at a low cost?
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–
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How easy is it for a user to cash-in/cash-out from an agent location?
Can he pay for the goods and services he availed to any merchant without any fee?
–
•
Can a person easily open a savings/loan account with a wallet scheme provider?
Does current wallet scheme providers allow him to send money to un-registered wallet users?
What is the cost of money transfer to off-net users?
Is this unbanked person getting satisfactory services from existing wallet scheme provider?
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8. How Interoperability provides Value to MFS Ecosystem?
•
Product innovation beyond domestic remittances and airtime top-ups
In collaboration, banks & MNOs can develop real banking products like micro loans, micro savings,
agri-finance, micro-insurance to address the banking needs of customers.
•
Enabling cost-efficient payments to and from the unbanked population
Cash in and cash out is an expensive proposition for everyone. There is a need to create an
ecosystem where Mobile Money can be accepted easily at all locations.
•
Expansion of pool of customers
Interoperability enables all wallet service providers to have access to larger market which will
eventually lead to a healthy competitive environment.
•
Low cost of operations
Interoperability provides a key benefit of reduction in cost of operation. With interoperability costs
can be shared among various wallet service providers for educating and creating awareness of MFS
among user and agents.
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9. Challenges to implement Interoperability
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How to route transaction between Mobile wallet service providers
–
–
•
Should agreements be signed with a central party or directly between the participants?
Will there be a central database of all customer wallets like MNP database?
Enabling communication across platform
– How to find a common language that all wallet platforms could interpret?
•
Managing AML/CFT
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–
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How to manage KYC/AML/CFT of the customers of other mobile wallet scheme providers?
How to control frauds in new use cases of interoperability?
Who will be liable for a fraudulent transaction done by a customer?
Financial Processes
–
–
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How to define a fee which provides a win-win proposition for both customer and wallet service provider?
How to define a common reconciliation and settlement process?
How the revenue assurance process will be carried out by finance team of mobile wallet scheme providers?
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10. Mobile Payment Gateway: A solution to address
interoperability challenges
Consumers
Wallet Acquirers
TM
m:Gateway
Wallet Issuers
Mobile Payment Gateway
Merchants
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11. Case Study: A Collaborative Business Model
The first Universal Mobile Money service
powered by Oberthur Technologies and MoreMagic Solutions™ in the Czech Republic
Goal: “Eliminate cash” by creating a new payment brand enabling to pay merchants, to top-up
airtime and to transfer money to friends
Mopet is a JV created in January 2010 including 4 banks and 3 MNOs
Oberthur selected as supplier in July 2011, service launched in Sept 2012
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12. Business Model
User A
User B
1.
Mopet is in charge of acquiring merchants
2.
A user can have only 1 MNO and 1 bank (User A has a contract with Vodafone and Ceska)
3.
The revenues comes mostly from merchant fees when a user (User A) make a payment
4.
Merchant fees is shared between Mopet, the MNO user (Vodafone) and Bank user (Ceska)
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13. Deepak Sachdeva
Sales Director-Russia & MEA
MoreMagic, An Oberthur Technologies Company
M: +971 50 5579179
d.sachdeva@moremagic.com
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