Cost and charging issues related to Mobile Financial Services (MFS) are a subject of study under ITU-T Study Group 3 Question 2/3. Mobile phones today offer constant communications, even to many of the world’s poorest people, and now they may also become the conduit for these people to access banking services for the very first time.
Over 2 billion of the world’s poorest people currently live on less than 3 dollars a day. The majority do not have access to any banking services. They cannot store money safely or transfer it securely to support their families or pay bills, or receive wages and other payments with certainty. At the same time, the global mobile-wireless infrastructure is expanding. Not surprisingly, this infrastructure has the potential to become the foremost banking interface for millions of people around the globe, predominantly in developing regions.
MFS include services such as mobile-enabled payment systems and mobile banking with security and convenience for transfers, payments and savings through the concept of a ‘mobile wallet’ account. MFS are now available in over 70 countries, carrying payment volumes of tens of billions of dollars each month.
MFS can offer potential for social and financial inclusion in cash-centric environments where the poorest struggle to survive and conserve their savings. With the goal of financial inclusion in mind, MFS should be available, reliable and attuned to the needs of the world’s poorest people. In this context, MFS charging structures should ideally be adapted to the levels of disposable income typical of a consumer living on less than 3 dollars per day.
The question of how to scale-up the adoption and use of MFS is complicated by the multi-sector nature of MFS which traverses both the banking industry and the telecommunications sector. Some of the ways to encourage MFS adoption might include:
- Assessment of the real needs of the poorest users of MFS and analysis of their financial behaviour.
- Agreement on an encouraging and enabling regulatory regime which fosters innovation and the development of low cost models that are essential for financial inclusion.
- Ensuring a level-playing field to encourage the development of MFS services.
- Understanding the real costs underlying the provision of MFS to all players in the value chain.
- Encouraging the public and private sectors to make use of MFS in areas such as the distribution of salaries and social welfare payments or the payment of utility bills.
ITU-T Study Group 3 (SG3) has launched work in this area over the past couple of years, including charging for MFS, guidelines for e-money issuers and agents. In this context, the study group works closely with the Focus Group (FG) on Digital Financial Services, with SG3 experts actively supporting the work of the Focus Group.
