LIVE FROM THE GSMA’S NFC & MOBILE MONEY SUMMIT, NEW YORK: It’s time to go beyond the industry mantra of ‘Banking the Unbanked’ and aim to replace cash with mobile payments for all consumers, said Tim Harrabin (pictured), senior adviser with Analysys Mason and a driving force behind the iconic M-Pesa mobile money service.
“My mission is to replace cash for everyone, not just those badged as unbanked,” said Harrabin.
He was speaking at the publication of a new white paper on the future of mobile payments by Analysys Mason. The paper was also supported by billing and software vendor Amdocs.
Based on his experience working for Vodafone, Harrabin drew some conclusions about the nature of banking and money in the developing world (Vodafone holds a stake in Safaricom, the operator that offers M-Pesa).
He pointed out that M-Pesa is actually very popular with consumers who already have bank accounts, as well as those without, so confounding one myth about the service.
He also had some insights about how the poor in a country like Kenya manage their finances: “They are far more financially sophisticated than us.” Unlike the wealthy in US and European countries, poor people in Africa have irregular incomes which necessitate complex financial deals to fund everyday life. And 99 per cent of budgets in a poor household are managed by women.
Harrabin said he oversaw every key development of M-Pesa, from the initial concept to its emergence as an internationally recognised mobile payment service.
The bigger picture than targeting the unbanked should to replace cash itself, he argued.
The centrepiece of M-Pesa’s service is remittances. But Harrabin said other markets will have different core services. Transport is a common one. In a country such as India the target could be the cash that is paid on the delivery of e-commerce purchases, he said.
The white paper found that less than 50 per cent of the 4,000 people surveyed thought mobile payments more secure than alternative methods. And 50 per cent of existing mobile payment users are not completely satisfied by the experience. Harrabin said both findings were “a surprise”.