By Heather McLean

Semir Mahjoub, president of Ericsson
mobile money services, explains how
this new division is planning on
changing the world of mobile money.

Ericsson launched its new mobile money business, Ericsson Money Services, in February this year. The launch of the new business included an end to end solution with an associated business and operational model, fulfilling all the awkward but necessary regulatory, legal and security requirements, in cooperation with Ericsson’s operator customers and players in the financial sector.

Through Ericsson Money Services and its Money Interconnect Service, mobile operators, financial institutions and other service providers that want to extend their offering with mobile money services, can be connected to a real time, cross-border, cross-currency switching network.

Traditional and cutting edge
Semir Mahjoub, president of Ericsson mobile money services, states that Ericsson sees itself as bringing the traditional and cutting edge together. He comments: “The role we see ourselves playing is in the integration of old technologies into new; we have banking for the unbanked, where people have mobile phones but no bank accounts, and the other side, where plastic cards are moving into mobile and NFC technology.

“We’ve contributed to build this mobile infrastructure to carry all these communications,” continues Mahjoub. “But for mobile money, you need another network added, that of financial services; mobile money is about isolated services at the moment, where you can’t transfer money from one network to another.”

That, says Mahjoub, is where Ericsson’s Money Interconnect Service comes in. “That’s what we’re doing with our Interconnect Service,” explains Mahjoub. “We’re making sure mobile money travels at the same speed as information, because that how users perceive the service of a mobile. To do that, there are complex clearing and settlement processes that need to be in place to provide this on a global scale. We’ve solved a lot of the complexities of this service already, such as integrating with banks, clearing, and pre-funding, all offered on a global scale.”

Ericsson Money app
Working from developing and cementing the relationships between those involved in the mobile money ecosystem, into the technical processes, to the end user mobile interface, Ericsson launched a Beta trial of its mobile money app, Ericsson Money, in September last year.

The Beta app trial initially involved 60 end users from six European countries: UK; France; Germany; Spain; Italy; and Poland. The users were able to send money to other users within the service. It was then ramped up to a few hundred end users, and then to a few thousand from those countries plus Sweden, and is now ready for commercial launch on a portal available directly from Ericsson.

Mahjoub claims the end to end service is suitable for all end users and service providers, from Ghana and the unbanked, to the US and NFC smartphones. He says the whitelabel solution is fairly flexible; the interface can be whatever is required by the service provider, including USSD, SMS and the web. The mechanism to handle money for all these variations needs to work in a similar way, just with different legal challenges depending on the service and geography, he adds.

The world’s mobile operators are now ready for the second generation of connected, integrated, interoperable mobile money services, claims Mahjoub, and that is what Ericsson has been working towards for two years.

Next generation
While the MPESA service in Kenya has been the flagship raging success story for unbanked mobile money services, Mahjoub argues that mobile operators are now looking at what needs to come next.

He explains: “There has been the first wave of operators rolling out mobile money services. MPESA became a big success, and technically speaking, that service was built to fulfil some basic needs. Now, operators understand what they need for the future: a centralised service; a service that is integrated with BSS; and that allows them to cross sell, so customers can use the mobile wallet to buy other products from the operator.

“For this, mobile operators are
looking for second generation systems.
That doesn’t mean the systems already
in place will need to be rebuilt, as
most of the initial projects out there
are made to fulfil a domestic interest
or cross-border money transfer; in the
latter case, connecting to our
services will enable them to reduce
the costs of their current services,”
he notes.

Mahjoub concludes: “There’s a lot that has to happen over the next few years to make this into one interconnected system.”