With the RBI Governor drawing attention once more to the use of technology in achieving inclusive growth, the latest MMU’s State of the Industry Report shows that mobile money services are catching up across the world: 110 deployments across 56 countries responded to the 2013 survey (up from 78 deployments in 2012 and 52 in 2011). India can use the experiences from other countries, drawing its own appropriate lessons.
The key data points as revealed by the survey are as follows:
- · Registered accounts: As of June 2013, there were 203M registered mobile money accounts. 9 markets have more mobile money accounts than bank accounts (compared to 4 in 2012). All 9 of these markets are in Africa: Cameroon, the DRC, Gabon, Kenya, Madagascar, Tanzania, Uganda, Zambia and Zimbabwe
- · Active accounts: 61M mobile money accounts were active on a 90-day basis. This translates to a 30% active rate.
- · Large deployments: 13 deployments have more than 1M active users, 7 of which passed this threshold between June 2012 and June 2013
- · OTC: In June, there were 17.3M unregistered users of mobile money. This comprises unregistered over-the-counter (OTC) users plus off-net transfers from registered accounts to unregistered users (or vice versa). Note that unregistered users were not counted in the registered and active account figures listed above. South Asia comprises 88% of the world’s unregistered users.
- · Competition: 52 markets now have more than one deployment, signaling increased scope for account-to-account integration
- · Gender: For the first time in 2013, MMU collected data on the gender of mobile money users. All participants were asked whether they knew the gender composition of their customer base. 32% of respondents gave a positive answer and were able to report a number. Within this sample, on average, 36% of mobile money users were women. This percentage ranges from 4% to 86%. Women represented the majority of users in only 6 deployments. Perhaps FSP should explore collaboration with MMU to figure out how to boost the response rate among MNOs on this question.
- · Breakdown by transaction: Airtime top-ups represent 75% of mobile money transactions (up from 61% in 2012), followed by domestic P2P transfers (18%), bill payments (4%), bulk payments (2%), and merchant payments (2%). Bulk payments was the fastest growing product with numbers of transactions increasing at an annualized growth rate of 617%.
- · Breakdown by value: Domestic P2P transfers represent 69% of the value transacted (down from 82% in 2012), followed by bill payments (11%), airtime top-up (9%), bulk payment (7%), and merchant payments (4%).
- · Average active customer: In June 2013, the average active customer conducted 5.8 airtime top-ups, 1.3 P2P transfers, 1.1 cash-in, 1.1 cash-out, and 0.3 bill payments.
- · Ecosystem development: 29% of the value transacted involved external partners (e.g. merchant partners; bill collectors; enterprises; etc.)
- · Revenues: 69 deployments reported revenue figures. Of these, 5 reported that mobile money contributed to over 5% of their revenues and 8 reported revenues of more than $1.0M in June 2013. These 8 deployments generated a total of $41M in revenue in June 2013. M-PESA’s contribution to Vodacom TZ’s overall revenues increased from 12.6% in September 2012 to 18.7% in September 2013.
- · Airtime sales: 10 operators reported selling more than 10% of their airtime through mobile money.
- · Beyond payments: 123 mobile insurance, savings, and credit services are live – 27 of which were launched in 2013.
- · Agents: The number of agents has reached 886,000; the number of agents outnumbers the number of bank branches in 80% of markets in the survey. However, 48% of registered agents were inactive in June 2013! The average agent conducts 6.7 transactions per day. On average, there are 28.4 agents per 100,00 adults compared to 4.6 bank branches per 100,000 adults; 39% of agents are in rural areas
- · Some formalized agent sharing: In several markets, providers are recruiting and managing agents that other providers use to deliver services. Examples of this model already exist in Nepal, Nigeria, and Zimbabwe.
MMU predicts three developments in 2014:
- · More examples of account-to-account interoperability, among mobile wallets and also with banks: In 2013, Indonesia was the first market where three operators – Indosat, Telkomsel and XL – enabled their mobile money schemes to directly transfer money in real-time between each other. Given how there are already 52 markets which have 2 or more mobile money services, MMU expects that more markets may also seek to interoperate their mobile money platforms, once they have identified the right technical and commercial models to do so successfully. There is also an opportunity for mobile money services to connect with more traditional financial services, enabling transactions and new products between bank accounts and mobile wallets. Many deployments have already started to integrate their services in this way, and we anticipate that many more will follow.
- · Ecosystem development: In 2013, transactions involving external companies have been driving the growth of mobile money globally, representing 29% of the value transacted in June. This is especially true among more mature services, where external companies and merchants contribute to an even larger share of the product mix. Going forward, we expect to see more mobile money services capture the payments demand from companies and institutions to drive high volumes of transactions on their platforms.
- · Other mobile financial services: A growing number of providers are interested in launching mobile insurance, credit and savings services, and we expect to see many new launches over the next couple of years. Mobile insurance, credit and savings are important new offerings and could serve to deepen financial inclusion, not only in terms of expanding access of these services to low-income customers, but helping to ensure financial stability and security as well. However, more proof points are needed for how these services can be offered sustainably, in order to ensure adequate levels of investments are made by the industry.