Cashing in on mobile money.
"A fundamental distinction when looking at the mobile payments opportunity is whether the end user has a bank account or not," says Stela Bokun, senior analyst, Pyramid Research.
"In markets like South Korea and Japan, typically 90% of adults or more have a bank account, while in emerging markets like Kenya, the portion ranges from 25% to 60%," Bokun added.
The distinction is important because the needs of those who have a bank account are very different from those without one, and there is the opportunity to provide banking and other financial services to those without a bank account, according to Bokun.
In Kenya and Tanzania, the contribution of m-payments services for the unbanked to the respective operators' total service revenue exceeded 10% within three or four years. Meanwhile NTT Docomo is not expected to reach such a ratio until this year, eight years after the initial launch of its m-payment services, and SK Telecom is only expected to reach double digits in 2016, six years after launch. This is despite the fact that both Asian operators have been addressing this market for even longer through a number of different initiatives and technologies and made significant investments, notably but not exclusively in financial institutions, Bokun said.
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