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Opportunities for telcos in mobile money: 2011 - Mobile payments: a wide range of services - EY - Global

Opportunities for telcos in mobile money: 2011

Mobile payments:
a wide range of services

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The range of players involved in the mobile payments ecosystem, its integration with the online world and its role in both remote and point-of-sale (POS) payments all suggest that the marketplace will continue to evolve rapidly.

Mobile payments refer to a wide range of services. Basic mobile banking services have existed for a decade, while many established mobile remittance services began life as peer-to-peer airtime transfer services.

At the same time, early mobile web and Wireless Application Protocol (WAP) interfaces for mobile payment have progressed to include payment on mobile application storefronts and online wallets on the handset.

An inside look: the mobile payments marketplace

Looking ahead, the mobile handset is seen playing a key role in services that combine payment with related customer data around purchasing preferences and identification, such as customer loyalty programs and event ticketing.

SMS-based services are the best-established, while other mobile payment channels, such as mobile internet and near field communications (NFC) have relied upon associated developments in web services and device capabilities.

The range of players involved in the mobile payments ecosystem, its integration with the online world and its role in both remote and point-of-sale (POS) payments all suggest that the marketplace will continue to evolve rapidly.

Mobile payment technologies and scenarios1

  SMS NFC Mobile internet
Payment type Person-to-person
Person-to-business
Business-to-person
Person-to-business
Business-to-business
Person-to-person
Person-to-business
Use case Domestic remittance
International remittance
Branchless banking
Contactless payments
Identification- and marketingrelated services
In-app payments
Mobile wallet transactions
Characteristics Payment services for the
unbanked and underbanked
High levels of cross-industry collaboration Extension of online payment services
Examples Salary payments (Roshan, Afghanistan)
Money transfer (M-PESA, Kenya; Obopay)
Transit payments (Mobile FeliCa, Japan) Mobile wallet (Paypal, Zong, Starbucks)
Payment providers and enablers Start-ups
Mobile operators
Money transfer companies
Handset manufacturers
Card issuers
Mobile operators
Handset manufacturers
Merchants
Start-ups
Web services players
Start-ups
Mobile operators
Merchants
Mobile operator participation High Medium Low

Newcomers are driving change in handset payments

Smartphone penetration allied with a more mature e-commerce market is producing a new wave of innovation in handset payments. For POS payments, start-ups are driving solutions that bypass the need for handsets with built-in NFC capability.

Beyond this, there are various solutions that promote the use of contactless stickers on handsets.

The role of credit card issuers remains fluid as they look to boost acceptance rates in developing markets and offer additional value-added services.

Meanwhile, large web and technology players are also looking for opportunities in the payment market, and are filing patents for mobile payments. Even payment hardware providers are getting involved.


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