Future of mobile money in the middle eastern region and how telecommunication operators and financial institutions can work together to accelerate its progress
It’s estimated that approximately 70% of the world population owns a mobile phone. Mobile smartphones are growing at an accelerated pace and by 2020 should outnumber the human population, with a ratio of 2:1. Smartphones are no longer only considered as communication tool, but its ubiquitous. It’s also a camera, a gaming console, a work station, a TV and now a payment device or even more so a Wallet! When you think about people would rather leave their wallets at home than their smartphones.
The concept of mobile money has been around since the late 2000’s. Mobile money users has grown from approximately 70 million in 2009 to an approximately 400 million in 2016.
Africa and Asia have pioneered the way mobile money due to a high unbanked population base. For the unbanked base in these regions mobile money (Fintech) is an alternative way to gain access to a variety of payment methods. For instance, In rural developing areas, where millions of mobile users are still unbanked, consumers use their mobile phones as an alternative–‐banking device. Simple mobile enables rural farmers to receive money from urban family–‐ members, P2P payment, transferred over great distances (mobile remittance).
It’s estimated that within 2018, approximately 750 million people will have access to Mobile Financial Services. This will mostly be dominated by Asia & Africa, where Mobile Operators drive initiatives to bank the unbanked. However other regions not so impacted with un-banking issues will also most likely take a slice of the market share. This is due to the Fintech eco-system extending its reach in more relevant domains, i.e. mPos, utility and goods payments, etc…
My focus will be to evaluate the Current and Future impact of Mobile Money in the Middle Eastern region.
The Middle Eastern region has been slow to join the mobile money revolution. Currently two most-relevant types of mobile money services in the Gulf States are direct carrier billing (DCB) and advanced mobile wallets which positions telecommunication operators in the ecommerce value chain.
My aim & question will be the following:
• To assess what are the concerns and issues for the slow uptake of Fintech/Mobile Money in the MENA region.
• How will banks and telecommunication operators coexist in the value chain. Who lead and who will follow?
• How can telecom operators via their network and scale compete with banks and financial operators?
• What is impact of mobile money OTT on both the telecom and banking industry. i.e. bitcoin, etc…
• How will main stakeholders work on converting customers into the mode of mobile money? What methods can be leveraged?
• How would blockchain technology and cryptocurrency impact the fintech transformation process in the middle east?
