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Right Regulation Will Help Mobile Financial Services Right Regulation Will Help Mobile Financial Services As mobile technology continues to spread across the globe enabling many to perform sundry tasks through the mobile phone, a recent study by Edgar Dunn has revealed that the convergence of mobile communications with financial services will help more than 1.4 billion people benefit from mobile financial services by 2015. The study conducted by Dunn, a specialist mobile banking and payments consultancy firm, in partnership with the GSMA, the global trade association for the mobile industry concluded that 1.4 billion people could be using mobile wallets i.e software that enables consumers to manage their money, including making and receiving payments, using their mobile phone - from about 10 million at the end of 2007. This study has given fillip to the drive by the GSM Association which has been working for years on initiatives that will drive mobile financial transactions. The association had in the last one year worked two major initiatives like the Mobile Money Transfer which is premised on international remittances and remote banking/payments and Pay-Buy-Mobile focused on transactions at point of sale. In order to ensure faster uptake of these initiatives, the association is working with Accenture, a global management consulting, technology services and outsourcing company, and Fundamo, a supplier of mobile banking and payments solutions, to establish a hosted mobile wallet platform that will enable mobile operators to pilot financial services rapidly and at low cost. Rob Conway, CEO and member of the board of the GSMA stated that "Momentum is building behind mobile financial services and we believe 2008 will be a seminal year for this exciting new sector," he added that "With the help of governments, mobile networks have the potential to bring the many social and economic benefits of financial services to hundreds of millions of people who live beyond the reach of the conventional banking network." The study identified the number one barrier to successful deployment of mobile wallets as government regulation. The GSMA calls on governments to ensure that regulation governing the deployment and usage of mobile financial services is proportionate to the risks involved. The association called on governments to regulate low risk money transfer services, which involve small amounts of money compared with traditional banking services, outside traditional banking regulation. It also urged governments to enable non-banks to become an agent of a bank or a remittance provider to facilitate the cash in and cash out activity on both sides of the mobile money transfer. According to the association, implementing regulation on the systems level without interfering with the customer interface whenever possible is a key that will help regulation. In his comments, Sunil Mittal, Chairman of Bharti Airtel and the GSMA board sponsor of the Mobile Money Transfer programme said "We have an immense opportunity to positively impact the lives of hundreds of millions of people by making financial services mobile," He added that "However, governments must ensure that proper regulations are put in place and obstacles removed to ensure the growth of this new market to deliver great value to the society." Elizabeth Littlefield, CEO of Consultative Group to Assist the Poor (CGAP), a global resource center for microfinance, in a latest report from the CGAP stable believes that balanced regulation can help increase access to financial services for poor people and is one way to fight poverty. The report stated that it will radically transform the way people use financial services in rich countries and in poor ones. Littlefield added that "Wireless may also allow us to reach people conventional business models never could reach, bringing them for the first time the ability to manage their own household finances, safely storing cash, moving it, spending it or investing it when needs or opportunities arise."
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