Technology is improving banking in Africa

According to the World Bank, an estimated two billion working age adults worldwide do not have access to formal banking facilities. The lack of access to banking products affects almost every nation: Even though the UK boasts a financial inclusion in excess of 97 per cent, this inclusion only ranges from 14 per cent in the Middle East to 69 per cent in East Asia and the Pacific, whilst in America, seven per cent of households are unbanked, with a further 20 per cent falling into the underbanked category.  

 

For the first time in history, financial inclusion is possible, thanks to innovations such as mobile money, e-commerce and other digital financial services that bridge the financial gap for segments of the population that were previously unserved.

 

M-Pesa in Kenya is undoubtedly the most well-known and well-established case study. Using simple mobile handsets, M-Pesa offers mass access to financial services. According to the IMF,  Africa as it stands today accounts for 32 per cent of the global mobile money market revenue, with a subscriber base of over 100 million thanks to the surge in the uptake of SMS-based mobile payment systems, influenced by, and including, M-Pesa.

 

The success of M-Pesa underlines the importance of designing a usage-based revenue model rather than dividing customers into “profitable” and “unprofitable” categories, based on their bank balance and income. By offering a low-cost transactional platform with higher volumes of smaller value payments, initiatives such as M-Pesa can offer a wide range of services, from bill payment to remittances.

 

Africa certainly doesn’t have the monopoly on mobile. Many geographies have had significant success using the channel for financial inclusion. As one of the pioneers of mobile banking in Asia, the Philippines has shown how the mobile device, when used in conjunction with a good business model, an understanding of consumer requirements, and the support of the government, can be harnessed to deliver low-cost and efficient financial services to the region. . Although there are no banks in over a third of the country’s 1,600 cities, the number of mobile SIM cards in proportion to the population lies at 114 per cent, which is 20 per cent higher than the global average. By incentivising usage, the mobile phone is now the main way to transfer money across the archipelago.

 

Read the original article here.

 

 

Read the original article here.

 

 

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According to the World Bank, an estimated two billion working age adults worldwide do not have access to formal banking facilities. The lack of access to banking products affects almost every nation: Even though the UK boasts a financial inclusion in excess of 97 per cent.

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According to the World Bank, an estimated two billion working age adults worldwide do not have access to formal banking facilities. The lack of access to banking products affects almost every nation: Even though the UK boasts a financial inclusion in excess of 97 per cent, this inclusion only ranges from 14 per cent in the Middle East to 69 per cent in East Asia and the Pacific, whilst in America, seven per cent of households are unbanked, with a further 20 per cent falling into the underbanked category.  

 

For the first time in history, financial inclusion is possible, thanks to innovations such as mobile money, e-commerce and other digital financial services that bridge the financial gap for segments of the population that were previously unserved.

 

M-Pesa in Kenya is undoubtedly the most well-known and well-established case study. Using simple mobile handsets, M-Pesa offers mass access to financial services. According to the IMF,  Africa as it stands today accounts for 32 per cent of the global mobile money market revenue, with a subscriber base of over 100 million thanks to the surge in the uptake of SMS-based mobile payment systems, influenced by, and including, M-Pesa.

 

The success of M-Pesa underlines the importance of designing a usage-based revenue model rather than dividing customers into “profitable” and “unprofitable” categories, based on their bank balance and income. By offering a low-cost transactional platform with higher volumes of smaller value payments, initiatives such as M-Pesa can offer a wide range of services, from bill payment to remittances.

 

Africa certainly doesn’t have the monopoly on mobile. Many geographies have had significant success using the channel for financial inclusion. As one of the pioneers of mobile banking in Asia, the Philippines has shown how the mobile device, when used in conjunction with a good business model, an understanding of consumer requirements, and the support of the government, can be harnessed to deliver low-cost and efficient financial services to the region. . Although there are no banks in over a third of the country’s 1,600 cities, the number of mobile SIM cards in proportion to the population lies at 114 per cent, which is 20 per cent higher than the global average. By incentivising usage, the mobile phone is now the main way to transfer money across the archipelago.

 

Read the original article here.

 

 

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