Highlights from the CGAP Technology Blog – October 2010

The launch of TigoPesa in Tanzania was the headline on our blog starting in October. With 4 mobile money services now live, the Tanzanian market has become an interesting one to watch. Mireya Almazan from the Bill & Melinda Gates Foundation and I talked about this recent development:

It has been clear for some time that the quick success of mobile money in Kenya was not to be easily replicated next door, nor in the over 40 countries that have launched mobile money deployments since 2003. Yet Tanzania appears to be developing its mobile money market at a commendable rate, and can potentially yield multi-player models that we have yet to see elsewhere.

Chris Bold asked our readers whether over-the-counter (OTC) payment services could be an effective strategy to increase customer usage of mobile banking:

What are the lessons that other mobile operators might learn from easypaisa and GCASH Remit? Firstly, allowing OTC transactions might be a useful way of building customer trust in a system and in the long-run help to increase the woefully low activation rates that many MNOs are experiencing. Secondly, OTC services could provide an additional revenue stream. And thirdly, the fact that any customer can use the service makes it de-facto “interoperable” and of more interest for the disbursement of large scale payments such as salaries, government payments or international remittances.

This month we also hosted the panel “Accelerating Access to Finance Through Technology: Mobile Banking” at the IFC’s FinNet 2010. This live webcast featured Nadeem Hussein from Tameer Microfinance Bank in Pakistan, Mung-Ki Woo from France Telecom-Orange, and John Staley from Equity Bank in Kenya. We’ll be posting the archived video from this panel soon.

Mark Pickens closed out the month by introducing his and Claudia McKay’s latest Focus Note on the customer use of branchless banking. Specifically he addressed the question whether branchless banking is really reaching the base of the pyramid:

We tackled this with data from about 8 branchless banking services and the portion of their clients who previously had no formal financial service. We hit most of the high profile pioneers: M-PESA in Kenya and Tanzania, Banco Postal in Brazil, FINO in India, GCASH and Smart Money in the Philippines, WIZZIT in South Africa, and WING in Cambodia. One finding is that 37% of active clients were previously unbanked. Put in terms of numbers of people, each service we studied brought 1.39 million people into the formal financial system for the first time. So, branchless banking does reach some not so small numbers of people.