Following the recent publication of the GSMA State of the Industry Report 2015, we wanted to pull out some key findings which are relevant to microfinance and financial inclusion as a whole.
Generally, it’s clear that mobile money has achieved great success in changing the landscape of financial inclusion and impacting the lives of those individuals using it. In the last 12 months, the rapid increase in the accessibility and usage of mobile money across the globe has continued. As can be seen in the infographics below, in 2015 the number of mobile money services increased to 271 across 93 countries and the number of registered mobile money accounts grew by 31 percent to reach a total of 411 million registered accounts globally! Impressively, mobile money providers now process an average of 33 million transactions a day and in December 2015 alone, the industry processed over a billion transactions.
As stated by Mats Granryd (GSMA Director General), customers are using mobile money more than ever. In Kenya for example, according to a recent article by CapitalFM, KCB and Equity bank report that the majority of transactions processed now occur over mobile channels, an increase of about 1000% in just 12 months. As a result, these organisations have seen their branch costs reduce by 4% as fewer clients utilise branch services. We expect similar trends to continue across the industry as more and more organisations adopt mobile technology.
The World Bank data reports that mobile money services are available in 85 percent of countries where the number of people with access to traditional banking institutions is less than 20 percent. This has the power to revolutionise how financial services are delivered to microfinance customers. To make it easy for MFIs to get started with mobile, the Musoni System has already been integrated with providers including M-PESA, Airtel, Yo!Payments, Payway, Ecocash, PayNet and Kopo Kopo. By taking care of the technical integrations, we aim to make it easier than ever for our partners to leverage the success of mobile money.
Two trends are responsible for the success and growth in the mobile money industry – an enabling regulatory framework and the rise of smartphones and greater internet usage. At Musoni, we’ve also noticed the rising ownership of smartphones and internet usage and have developed client facing and loan officer facing apps to further help MFIs improve efficiency.
For example, we’ve developed a tablet application (Android) to help financial organizations to expand their outreach. Using the tablet app, loan officers are able to travel into rural areas with less dependence on the branch, improving their efficiency, reducing the amount of paper work, and increasing the speed of opening savings accounts and processing loan applications. Also, we are in the process of developing a mobile application that will enable the end clients in rural Africa to check their balances, transfer funds between their accounts and make loan applications straight from their mobile phone.
The report concludes by saying, despite the success of mobile money, there’s still more to be done. The launch of new services has been slowing down (with 13 new services launched in 2015, compared to 30 services in 2014 and 58 in 2013). This has caused customers to rely on limited services. Therefore, providers are called upon to invest in building a broader ecosystem, partnering with other industry stakeholders to provide customers with new and affordable products and services. At Musoni, we promise to do just that.