Transcript Slide 1

Congreso de Acceso a Servicios Financieros, Sistemas y
Herramientas de pago
Cartagena– March 2010
Aprendiendo de los diferentes modelos de banca móvil en
el mundo
Implementing
new mobile money strategies to increase revenues for Banks, MNOs and
Retailers
YellowPepper
YellowPepper provides mobile financial
services that allow consumers,
businesses and institutions to effectively
conduct monetary and financial
informational
transactions using a cell phone.
The Company
Current Status
• The Company has successfully penetrated the
banked market in six countries.
• Presently handles more than 5,300,000
transactions per month.
• Addressing over 1,700,000 unique users in
those six countries.
Current Partner Operators
Ecuador
Colombia
Bolivia
Peru
Guatemala
Panama
Soon:
Dominican Republic
Clients: Financial Sector
Ecuador
Colombia
Bolivia
Perú
Guatemala
Cooperativa Alianza Minas
Nuestros Clientes:
Sector Comercial
Partners
Colombia:
All regions:
Banked and Unbanked
Access to Financial Services
Source: Felabanc
World is moving towards
electronic money…
Us Market: Share of Payments by type
Emerging markets lag
behind…
Emerging Markets Share of electronic / card transactions :
Just 3 emerging Markets above:
Over 65% of population; only 9.5% of electronic transactions. HUGE GAP!
Lots of room … lots of
opportunity
Payment cards per person – top 20 countries
2.69 Just one aspect of electronic
money infrastructure – Cards
(plastic e-wallets)
Emerging markets
have not embraced electronic
payments yet.
Opportunities are large and
growing.
0.03
For banks, retailers,
governments,
Telcos, processors, others (e.g.
Fbook, Skype, Microsoft, etc.)
IFC Key drivers:
•
Electronic money no longer a wish or fantasy – now a requirement for modern life
•
E-Commerce / m-commerce driven demand; physical distance between service / product
providers and consumers keeps increasing
•
Virtual / dematerialized goods and services (are propelling a self servicing society or lifestyle);
•
Retail automation allows and requires electronic money; organized retail prefers not to
handle cash
•
Less and less cash issued (governments, businesses pay through banks, payment cards)
•
Technology advances in terms of (a) “last mile connectivity” and (b) lower cost of terminals
•
Advances in mobile technology promises that this newest extension of the payment
infrastructure, presents a large opportunity (note: architecturally and functionally, it is not
entirely new territory).
IFC
Why does the World Bank
Group / IFC care
•
Electronic money brings transparency, inclusion, speeds up economic
processes
[WBG AGENDA: reduce corruption, money laundry, grey economy]
•
Electronic money is deposited money – it is “saved” money and it is
“investable” money.
[WBG AGENDA: Savings Mobilization]
•
Electronic payments infrastructure allows for the “last mile” connectivity
between financial institutions and clients bringing down servicing cost and
improving interaction;
[WBG AGENDA: Access 2 Finance]
•
The commercial opportunity is also large given the enormous gap that needs
to be filled…
[IFC AGENDA: Demonstration of commercial success]
Bank Strategy
Comparison of the cost of a banking transaction by channel in a bank in S.A.
and % transaction migration to the mobile channel in 2 years:
Bank Channel
Cost per
Transaction
Savings Vs
mobile %
Migration to
Mobile
Mobile
$0.04
Teller
$0.87
95%
23%
Call Center
$0.39
90%
50%
ATM
$0.20
75%
10%
IVR
$0.32
88%
50%
Online
$0.07
40%
2%
Remittance Collection
$5.00
99%
0%
IFC
World Bank Group Offering:
Proprogress,
competition
friendly
policies
Develop
Payments friendly
Regulatory
Framework
Advisory, consultative
services and research
Develop the
necessary
echo-system
(A2F)
Research and
experimentat
ion
Fund seedstage
companies or
initiatives
Fund
early/growth
stage
companies
Scale
through
mainstreaming
IFC Core Business
[Under
development]
(help design, develop and grow
commercial opportunities)
Regulatory
Advisory
infoDev / CGAP
[EPIS]
Payments Practice
Financial Services
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Current MFS Situation
• World Wide tendency for both: Banked and Unbanked
population
• The purpose is to increase the access to financial services
• Solution implementation has depended on available
technology (Handsets + MNOs infrastructure)
• Most of the current solutions include mix architectures
(Several technologies)
• Compare with other e-channels two new elements must be
considered: The MNO and the handset
• The solution must consider a constant evolution base on
environment requirements (New Business Models, New
Technology, New actors, etc.)
Challenges ahead (1/2)
• New environment (Banks/Solution Suppliers/MNO/End
users/)
• Different risks base on the technology and Business
Model chosen
• Regulatory Policies
• Cultural differences and needs for the different countries
in Latin American region.
• Integration into already existing monetary/transactional
systems
Challenges ahead (2/2)
• Balance between technology and operational controls
• Registration of customers.
• Adoption of the services offered in the mobile channel
• Different technologies for different users
• Agent (Cash-in/Cash-out) network – M-Wallet
• Integration of major sector of the economy, like: utilities,
retailers, distribution of mass consumer products, etc.
Available Technologies
Virtual POS
M-Commerce
M-B2B
M-Wallet
M-Payment
Top-Ups
M-Commerce
M-Banking
• M-Banking
M-Wallet
– Saving and Checking account
M-Payment
– Credit card payment
– Accounts balance request
B2B (Purchases)
– Money Transfer
B2C (Purchases)
– Utilities service payment
Mobile POS (Purchases) – Other Bank e-services
Remittances (Money
Transfer)
M-Info
•
•
•
•
•
•
M-Remittance
Service Options
Total Picture
Tools
Available
Technologies
Riesgos
Features
available in
Dependence of
the MNO
Objective
Market
The standard handset
features are used
The handset web
services features are
used
Custom application
are developed for the
handset
A secure enviroment
provided by the MNO
is used
SMS
Voz/IVR
USSD
HTTPS Normal browser
WAP
J2ME - Applications
SIM Toolkit WIB
(Wireless Internet
Browser) . S@T. Java
Cards
None encripition, the
information could be
monitored
Same risk of an Internet
access. (Clonning,
Hijacking, Malware,
Virus, Man in the middle.
Phising)
Same risk of a
resident application
in the PC. Application
authenticity and
integrity
None
All Handsets
High End Handsets
High End Handsets
In all SIM with the
applications
None - The handset and
network features are
used
None- The WEB/WAP
service access is used
None -The WEB
service access is used
Yes
Developing Markets
Developed Markets
Developed Markets
Developing Markets
21
Source: Bankable Frontier Associates
M-Banking - Benefits
•Banks
•Cost Reduction
•Operating Expenses Reductions
•Fraud Reduction
•Revenue from the use of funds
•MNOs
•Significant Increase in SMS volume
•Increase in use and relevance of smart phones and mobile phones in
general
•Stimulate transition to electronic top-ups
•Retailers
•New form of payment
•Reduction of cash and checks handling
•Expand e-Commerce
M-Wallet -Benefits
•Banks
•Increase in deposits
•Source of viable new customers for the bank
•New business opportunities like B2B services
•New revenue from the use of funds
•MNOs
•Brand assertion and relevance to customer base
•Increase ARPU and reduce churn
•Stimulate transition to electronic top-up
•Retailers
•New form of payment
•Reduction of cash
•Expand e-Commerce
•Increase revenue from Cash-out, sales of kits, and
increased traffic of consumers
Conclusion
“The challenge for the nascent Mobile
Money industry in Latin America is to
successfully forge the alliances and
cooperation needed to build the Ecosystem
with innovative business models that will
work for all the stake holders and ultimately
that would benefit the end-user”
YellowPepper