As it celebrates its fifth anniversary, mobile payments provider Mi-Pay remains positive about the mobile money market and predicts that the next five years will bring new services, players and greater financial freedom to the world’s most disenfranchised populations.
While global recession has left its mark on many industries, Mi-Pay believes it has also acted as a catalyst for mobile-based financial service adoption; allowing the company, now ranked in the world’s top ten mobile money providers, and top five in terms of service based offering, to continue expansion of its services in Africa, India, Eastern Europe and Latin America during 2009 and 2010.
Norman Frankel, CEO of Mi-Pay explained: “As banks, service providers and mobile operators seek to overcome economic challenges, drive more efficient infrastructure and create stickier services for larger groups of customers, many are now turning to mobile payments, remittances and top up to boost reach, fuel demand and renew customer loyalty. As a result, we predict that the next five years will see mobile money shift from being a niche service to a viable mass market proposition with widespread global adoption.”
Many industry analysts confirm Mi-Pay’s outlook. For example, Informa predicts that in 2013 there will be 300 billion mobile payment transactions, totalling $800 billion. It also suggests that revenue from mobile payments in 2013 will be as high as 10 billion, a twelve-fold increase on what we see today.
Similarly, Berg Insight believes mobile banking will grow at 89% a year; peaking in 2014 with 913 million global users. Berg also forecasts up to 20% of international money transfers will be carrier out via the mobile generating a further $170 millionto $680 million in service revenues.
But it is not all plain sailing, according to Frankel. “This is a complex, technically challenging and heavily regulated environment; fraught with difficulties for uninitiated players seeking fast rewards. Our five years of expertise makes us one of the most experienced mobile money service providers in the world. The lessons we have learnt from live implementations and service roll outs, in some of the world’s most demanding regions, will allow us to continue to navigate these challenges; delivering the most flexible money services to our customers irrespective of location or market.”
In Sep 2004, Mi-Pay started integrating mobile functionality with payments and other financial services and shortly after was offering top-up switching services to its first international client, leading European network operator, KPN Telfort. Following a joint venture with Digital Payments, Voca Ltd and Retail Decisions, Mi-Pay has subsequently been able to attract and secure major customers such as Carphone Warehouse, Tesco, Du and Vodafone to its portfolio.
Paul Layte, the director of Carphone Warehouse commented: “We are delighted at Mi-Pay’s achievements. Its indemnified mobile top up service has played a core part of our value proposition over the past five years. Not only has it made buying airtime more convenient for our pre-paid customers but it has lowered the costs and reduced the risks normally associated with providing this type of service.”
Today, Mi-Pay’s customer base spans its focused corridors of Europe, Middle East and Africa. While domestic and international topup remains a core part of its business, it is now involved in mobile banking and, mobile money transfer deployments. It has been able to achieve this by using best of breed technology; developing innovative business processes to control and manage payment risk; and choosing its partners wisely.
Postilion, for example, provides the payments platform that handles all of Mi-Pay’s transactions worldwide. Mark McMurtrie, marketing director, Postilion International, said: “Mi-Pay’s investment in a non-proprietary and flexible architecture demonstrates the foresight that has made the company a leader in its field. Rather than adopting a ‘good enough’ approach, Mi-Pay chose our globally proven payments platform which is based on an open systems infrastructure. With Postilion as the core payments engine, Mi-Pay has been able to expand and diversify into feature-rich mobile financial services as the market evolved.”
With its eyes fixed firmly on the future, Mi-Pay is keen to help others exploit the benefits of mobile money services. An advisory member of the International Association of Money Transfer Associations, Mi-Pay is also a founding member of the GSMA’s Mobile Money Vendor programme, and is an active participant in its Mobile Money for the Unbanked programme.
Frankel added: “We feel strongly that mobile based financial services can greatly help those people disenfranchised due to social, political, economic or geographical constraints. It allows access to convenient payments mechanisms; generating new opportunities for trade and socio-economic growth. The roll out of our agent-based, person to person money transfer platform in Africa is testament to this; we look forward to witnessing the benefits that it delivers over the years to come.”