Leading mobile operator America Movil and US bank Citigroup have announced a joint venture to offer mobile banking throughout Latin America, in what would be a major boost to the take-up of such services in the region. The joint venture called Transfer will launch its service first in Mexico in the first quarter of 2012. America Movil has an ambitious target for the new venture which it will offer to its existing subscribers. It hopes to attract 15 percent of its subscriber base in the Americas within three or four years, according to its CEO Daniel Hajj as reported by Dow Jones Newswires. The operator had total mobile connections of 236 million at the end of Q2 2011 according to research firm Wireless Intelligence, meaning it is aiming for approximately 35 million subscribers to its mobile banking service.

Many mobile subscribers in Latin America currently lack access to basic banking.  The new service will allow mobile users to open bank accounts, transfer funds, withdraw cash from ATMs, make in-store purchases, pay utility bills and make online purchases via their mobile phones.  National governments could also utilise the service to pay civil servants’ wages and distribute subsidies to the poor.  It will be an open platform in which rival mobile operators and banks can participate as well as America Movil and Citi.

In Mexico mobile subscribers will pay between 1-2 Mexican pesos (7-15 US cents) per transaction and the two partners will share the resulting revenue. It is thought that approximately three times as many people in Mexico have mobile phones as bank accounts. Initial investment in the joint venture by America Movil has been US$50 million.