Mobile money is now a routine part of our everyday financial services ecosystem, with over USD1tril of mobile transactions processed in 2021 according to the State of the Industry Report on Mobile Money published by industry association GSMA.
Now, with over 1.35 billion mobile money accounts transacting USD2mil per minute globally, it’s clear that this exciting new financial dynamic is powering up new opportunities across the world. What’s most remarkable is the innovation at the heart of the industry, delivering use cases as far-reaching as pay-as-you-go solar power technologies through to the everyday digital wallets that are becoming increasingly pervasive in markets both mature and developing.
As mobile money continues to accelerate around the world, Neural Technologies looks into what mobile money is, what it means, and where it’s really taking off.
What is mobile money?
Mobile money is a range of financial and cash services performed through a mobile device, including digital wallets, e-payment services, and mobile top-ups.
This new, digitized payment ecosystem is offering fresh avenues to boost financial access, providing new opportunities for communities to engage financial services through a mobile money app and digital platforms without the need for nearby physical banking infrastructure.
Mobile money is also enhancing opportunities even in markets with significant penetration of traditional banking services, providing a new, competitive, user-friendly landscape that can help improve the overall resilience of financial services and access.
Technologies like Neural Technologies’ own Mobile Money solution are designed to protect and secure a wide range of these mobile money transactions, including top-ups, payments, transactions, and withdrawals, ensuring that secure access is at the heart of this rapidly evolving ecosystem.
Where is mobile money used around the world?
Mobile money is used across the globe, but analysis reveals encouragingly high growth and penetration in traditionally underserved markets where mobile money offers significant opportunities for new financial access, with particular focus in low- and middle-income countries.
Analysis by the World Bank reveals that in 2014, just 2% of adults worldwide had a mobile money account, rising to 10% globally by 2021. That figure rises to 33% of all adults in Sub-Saharan Africa. Overall, mobile money accounts contributed to an eight percentage point rise in individuals with access to some form of financial account in developing countries from 2017 to 2021.
GSMA’s Mobile Money Prevalence Index reinforces these findings, revealing the highest usage in Benin, Congo, Côte d’Ivoire, Eswatini, Ghana, Kenya, Lesotho, Rwanda, Tanzania, and Uganda, showing how digital technology is offering a remarkable opportunity to bridge the access gap in countries with less widespread physical financial services infrastructure.
On a regional level, the State of the Industry Report on Mobile Money also offers a fascinating picture of this technology which echoes this story. Of the 1.35bil registered global accounts in low- and middle-income countries, almost half (605mil) are in Sub-Saharan Africa—a region with less mature banking infrastructure—and more than half (183mil) of the 346mil accounts deemed as active are located in the region. Transaction volumes increased by 40% year-on-year in this region, reaching almost USD700bil in 2020, almost 70% of total global transacted value.
|Mobile Money Around The World|
|USD1tril value of mobile transactions in low- and middle-income countries|
|Region||Registered Accounts (mil)||Year-on-year-growth|
|East Asia and Pacific||328||+30%|
|Latin America and The Caribbean||49||+22%|
|Middle East and North Africa||59||+7%|
|Europe and Central Asia||22||+4%|
Transaction volumes and values are also on the rise across the world, with every region analyzed showing growth, meaning that mobile money is now a trillion-dollar industry. That includes over USD66bil of merchant payments processed annually, up 48% year-on-year, and USD16bil of international remittances, up 48%.
Protecting mobile money solutions at Neural Technologies
The rate of growth for mobile money has been astonishing, with those 1.35bil accounts reflecting a huge increase on the 134mil identified in GSMA’s inaugural State of Mobile Money report in 2012. This is also echoed by the World Bank findings showing a huge rise from 2% to 10% of adults globally having a mobile money account.
Given the powerful opportunity to boost financial inclusion these accounts offer, it’s vital that they’re delivered through a secure ecosystem that protects users and operators. Neural Technologies’ Mobile Money solution utilizes sophisticated KYC technologies to help mitigate many of the risks posed by fraud in mobile money transactions, backed by comprehensive transaction monitoring and automated analysis to ensure ongoing oversight of mobile transactions.
It is backed by advanced link analysis founded on our neural network expertise, allowing rapid identification of fraud, while also ensuring regulatory compliance through matching to AML and CFT lists. Comprehensive event data analysis also allows an end-to-end view of a customer lifecycle, further reducing the risk of fraud.
Mobile money is providing a doorway into new financial opportunities around the world. We need to ensure that doorway comes with a lock that provides for safe participation of all. In doing so, we not only protect customers, but the value of an evolving financial technology which could have huge positive implications for equal financial access across the globe.