A mobile financial service is an approach to offering financial services that combines banking with mobile wireless networks which enable users to execute banking transactions. Financial services encompass a broad range of businesses that manage money, including credit unions, banks, credit card companies, insurance companies, accountancy companies, consumer-finance companies, stock brokerages, investment funds, individual managers and some government-sponsored enterprises.
Mobile financial services can be broadly categorized into three areas: mobile payments, mobile banking, and microfinance. Mobile payments are online international payments for virtual goods: it is used to money paid for a product or service through a portable electronic device such as a tablet or cell phone, also known as m-commerce. Mobile banking includes financial transactions on a mobile device: it includes account information, transaction, investments and content services etc. Microfinance is a type of banking service that is provided to unemployed or low-income individuals or groups who otherwise would have no other access to financial services (loan & EMI payments).
According to study, “Mobile Financial Services in Asia-Pacific: Telco Service Portfolios and Positioning Strategies” some of the major companies that are currently working in the mobile financial services in Asia-Pacific are NTT Docomo, Telkmosel, Globe, Singtel, Google, Alipay, ANZ, Shinhan Bank, Samsung, Apple, Fuse, Axiata, Smart, Robi, BIMA ,Telenor, Ooredoo, Digicel, AIS, True, XL, Grameenphone, Rabbit Line Pay, Tameer Bank, Mynt, Ant Financial, Ayala Corp., MasterCard, PayPal, Alibaba, Bank of Philippines Islands, BancNet, CIMB.
Some mobile financial services technologies are short message service (SMS), mobile-enabled websites & browsers, mobile applications, and wireless payment technologies. SMS is a text messaging service component of phone, Web, or mobile communication systems: it uses standardized communications protocols to allow devices to exchange short text messages. The mobile-enabled Web site is designed to detect the type of device the customer is using (e.g., mobile device or desktop computer) and displays web pages in the best format for that device. Mobile financial applications are developed by or for financial institutions to allow customers to perform account inquiries, retrieve information, or initiate financial transactions. Wireless payment technology includes near field communication, image-based, carrier-based and mobile person to person.
Some applications of mobile financial service are SMS payments, chip payments, WAP banking, browser banking, remittances, person to person payments, merchant payments, account balances and alerts etc.
Bangladesh has a rapidly growing mobile financial services industry, with at least 17 providers already offering services on the market. By the end of 2016, the number of total agents was 7,10,026, the number of registered customers was almost 41.1 million, a number of total transactions were 1,473.2million and the number of total transactions was BDT 2346.9 billion. In the country, some guidelines services for mobile financial services are cash in/out using the mobile account, business to person payments, government to person payments, person to person payments, disbursement of inward foreign remittances etc.
In 2017, some trends are shaped into the mobile financial sector in India. These trends are Paytm thrives on demonetization, artificial intelligence powered chatbots, Unified payments interface growth, biometric authentication, and ATMs shut down. Additionally, regulators approved a new type of bank, known as payments banks, which can operate savings accounts accepting deposits of up to INR100,000 (roughly $1,500) and let customers make digital payments with their accounts.
In Asia-Pacific, mobile digital wallets are the most popular type of mobile financial service solution, enabling transactions from connected devices and a variety of providers to offer branded m-wallet services. There are some payment services are included such as Alipay, Tenpay, Payease, Asiapay, NTT Com Asia, PaySec, Red dot payment, Molpay, 2C2P, and context Asia etc.
In 2018, the central bank of Bangladesh allowed mobile operators to hold a maximum of 49 percent shares in MFS providers. Smartphone penetration of population is expected to reach 64% in Asia-Pacific, proving that more people have access to a mobile device than to banking services in the region. It is expected that mobile financial service market will reach US$72 billion by 2020.
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Ankur Gupta, Head Marketing & Communications