Mobile payments: What has changed ten years later?
Introduction
When the Globe Telecoms Philippines launched its G-CASH product in 2004 as a competitor to the successful remittance launched in 2000 by Smart, the second mobile operator in the Philippines, it seemed clear that it was only a matter of time before mobile payments . and mobile banking became an important part of the way poor people received financial services. The M-Banking 2009 MicroSave-Microenterprise Access to Banking Services (MABS) dialogue, held in Manila, generated some reflection on what has changed for ten years in the mobile banking environment. This informative note considers some of the most important developments.
Platform / Protocol In the first days of mobile payments, two major issues concerned potential suppliers. Would there be coverage in the areas where unbanked and potential users would be located? And what applications/communications could the phones support? It turns out that they should have been more concerned with business models and customer value propositions.
The coverage problem has largely disappeared, at least for the global mobile communications service system (GSM). Few mobile service providers now seem to be concerned about coverage. In most low-income markets, General Radio Packaging Services (GPRS) are now available and 3G is launched or expected. Network security may still be a cause for concern, but it is probably not a major obstacle to operations other than other infrastructure constraints routinely faced in remote areas (power outages, bad roads, etc.). In fact, in many countries, mobile communication networks have proven to be the most resilient in times of crisis. The evolution of the phone is more difficult to track, but it is certainly changing rapidly. Three trends seem relevant. Figure 1 highlights the extent to which more and more phones are "improving", which means we can handle application downloads over the air using GPRS.
One of the biggest concerns ten years ago was the nuisance factor experienced when customers had to download an application using the SIM (SIM) card. In fact, most of the early solutions that require menu transfers or for customers to remember long "chains of numerical codes" had no commercial success and created an asymmetry between the target and reached segments. Although targeted to those who do not have banking services, it was largely those who had access to banking services and those who knew how to read and write who could control the download process and those who did not have banking services. needed dedicated help and support to manage this process, which dramatically increased the cost of launching a service. With more modern phones, a dramatic drop in the cost of phones, Java applications, GPRS services (and an increasingly technology-conscious market), these problems appear to have been largely solved for many users. Of similar concern was the SIM card issuance of mobile carriers to handle additional applications. While there is little data available, it appears that most networks have successfully migrated most users to 64k SIM cards in the normal course of business, eliminating the constraint and eliminating the need for customers to implement a Potentially Confusing SIM card. exchange to take advantage of adoption in mobile al.
The third issue concerns security as operators have to balance trade-offs with ease of use and security. These issues remain and remain a key feature in the discussions about the appropriate business model and the partnerships needed to succeed. Now, there are probably three groups of "core solutions" and related business models competing in the market that reflect these trends:
i) Integrated and dependent SIM solutions: the best-known example of such a solution is M-PESA from Safaricom, which is now pre-loaded on all new Safaricom SIM cards. Integrated into the SIM card, the solution can work and was designed to work in the most basic phone and has end-to-end encryption. However, given the degree of technological integration, this type of solution is extremely difficult to offer for a non-mobile network operator (MNO) and therefore provides an MNO a great advantage over other mobile providers and therefore it is a key feature of the main business with MNO models.
When the Globe Telecoms Philippines launched its G-CASH product in 2004 as a competitor to the successful remittance launched in 2000 by Smart, the second mobile operator in the Philippines, it seemed clear that it was only a matter of time before mobile payments . and mobile banking became an important part of the way poor people received financial services. The M-Banking 2009 MicroSave-Microenterprise Access to Banking Services (MABS) dialogue, held in Manila, generated some reflection on what has changed for ten years in the mobile banking environment. This informative note considers some of the most important developments.
Platform / Protocol In the first days of mobile payments, two major issues concerned potential suppliers. Would there be coverage in the areas where unbanked and potential users would be located? And what applications/communications could the phones support? It turns out that they should have been more concerned with business models and customer value propositions.
The coverage problem has largely disappeared, at least for the global mobile communications service system (GSM). Few mobile service providers now seem to be concerned about coverage. In most low-income markets, General Radio Packaging Services (GPRS) are now available and 3G is launched or expected. Network security may still be a cause for concern, but it is probably not a major obstacle to operations other than other infrastructure constraints routinely faced in remote areas (power outages, bad roads, etc.). In fact, in many countries, mobile communication networks have proven to be the most resilient in times of crisis. The evolution of the phone is more difficult to track, but it is certainly changing rapidly. Three trends seem relevant. Figure 1 highlights the extent to which more and more phones are "improving", which means we can handle application downloads over the air using GPRS.
One of the biggest concerns ten years ago was the nuisance factor experienced when customers had to download an application using the SIM (SIM) card. In fact, most of the early solutions that require menu transfers or for customers to remember long "chains of numerical codes" had no commercial success and created an asymmetry between the target and reached segments. Although targeted to those who do not have banking services, it was largely those who had access to banking services and those who knew how to read and write who could control the download process and those who did not have banking services. needed dedicated help and support to manage this process, which dramatically increased the cost of launching a service. With more modern phones, a dramatic drop in the cost of phones, Java applications, GPRS services (and an increasingly technology-conscious market), these problems appear to have been largely solved for many users. Of similar concern was the SIM card issuance of mobile carriers to handle additional applications. While there is little data available, it appears that most networks have successfully migrated most users to 64k SIM cards in the normal course of business, eliminating the constraint and eliminating the need for customers to implement a Potentially Confusing SIM card. exchange to take advantage of adoption in mobile al.
The third issue concerns security as operators have to balance trade-offs with ease of use and security. These issues remain and remain a key feature in the discussions about the appropriate business model and the partnerships needed to succeed. Now, there are probably three groups of "core solutions" and related business models competing in the market that reflect these trends:
i) Integrated and dependent SIM solutions: the best-known example of such a solution is M-PESA from Safaricom, which is now pre-loaded on all new Safaricom SIM cards. Integrated into the SIM card, the solution can work and was designed to work in the most basic phone and has end-to-end encryption. However, given the degree of technological integration, this type of solution is extremely difficult to offer for a non-mobile network operator (MNO) and therefore provides an MNO a great advantage over other mobile providers and therefore it is a key feature of the main business with MNO models.
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