This document is offered compliments of
BSP Media Group. www.bspmediagroup.com
All rights reserved.
Mobile Financial Services & Wallet Wars
Opportunities or Threat
Deepak Sachdeva
Sales Director – Russia & MEA
MoreMagic, a...
Agenda

•

Mobile Financial Services & Wallet Wars: Opportunities or threat

– Economic viability of financial series for ...
Mobile Financial Services are here from last 6 years…

•

Started 6 years ago with pioneers MNOs in Africa and Asia

•

Le...
...but results vary a lot and lack key elements
Service penetration

•
•
•
•

Ecosystem challenges
Technical instability
N...
Wallet Wars…few examples

Nigeria (19)

© Oberthur Technologies 2013

Uganda (07)

19/11/2013

Kenya (05)

5
Are unbanked population getting benefited from
Wallet Wars?

•

Do unbanked population have easy access to financial servi...
How Interoperability provides Value to MFS Ecosystem?

•

Product innovation beyond domestic remittances and airtime top-u...
Challenges to implement Interoperability

•

How to route transaction between Mobile wallet service providers

–
–
•

Shou...
Mobile Payment Gateway: A solution to address
interoperability challenges

Consumers

Wallet Acquirers

TM
m:Gateway

Wall...
Case Study: A Collaborative Business Model

The first Universal Mobile Money service
powered by Oberthur Technologies and ...
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 (...
Deepak Sachdeva
Sales Director-Russia & MEA
MoreMagic, An Oberthur Technologies Company
M: +971 50 5579179
d.sachdeva@more...
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Mobile financial Services & opportunities or threat

  1. 1. This document is offered compliments of BSP Media Group. www.bspmediagroup.com All rights reserved.
  2. 2. Mobile Financial Services & Wallet Wars Opportunities or Threat Deepak Sachdeva Sales Director – Russia & MEA MoreMagic, an Oberthur Technologies company
  3. 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 © Oberthur Technologies 2013 11/19/2013 2
  4. 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 © Oberthur Technologies 2013 19/11/2013 3
  5. 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 © Oberthur Technologies 2013 19/11/2013 4
  6. 6. Wallet Wars…few examples Nigeria (19) © Oberthur Technologies 2013 Uganda (07) 19/11/2013 Kenya (05) 5
  7. 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? – – • 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? © Oberthur Technologies 2013 19/11/2013 6
  8. 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. © Oberthur Technologies 2013 19/11/2013 7
  9. 9. Challenges to implement Interoperability • 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 – – – • 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 – – – 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? © Oberthur Technologies 2013 19/11/2013 8
  10. 10. Mobile Payment Gateway: A solution to address interoperability challenges Consumers Wallet Acquirers TM m:Gateway Wallet Issuers Mobile Payment Gateway Merchants © Oberthur Technologies 2013 19/11/2013 9
  11. 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 © Oberthur Technologies 2013 19/11/2013 10
  12. 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) © Oberthur Technologies 2013 19/11/2013 11
  13. 13. Deepak Sachdeva Sales Director-Russia & MEA MoreMagic, An Oberthur Technologies Company M: +971 50 5579179 d.sachdeva@moremagic.com © Oberthur Technologies 2013 19/11/2013 12
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