I've been doing some mobile financial services research lately and came across a few interesting stats I'd like to share: 

 1) Mobile wallet deployment will grow to 1.4 billion by 2015 and will account for $510 billion in transactions
Edgar Dunn & Company, 2007

 2) The difference in ARPU between mobile money users and non users is up to 74%
GSMA, 2009

3) 53% of M-PESA users use it to send & receive money
FSD Kenya, 2008

4) 14% of M-PESA users use it to store & save money
FSD Kenya, 2008

5) M-PESA is considered 96% more convenient than alternatives
FSD Kenya, 2008

6) 248 million mobile subscribers will make at least one international remittance transaction on their mobile phone by the year 2012
Edgar Dunn & Company, 2007

7) 79% of developing markets consider international remittance as "extremely important" compared to 47% of developed markets
Edgar Dunn & Company, 2007

8) There are 4 billion people at the bottom of the economic pyramid that represent a $5 trillion market
Lars Thunell, Executive Vice President & CEO of IFC

9) 70% of M-PESA customers are existing bank customers
CGAP, 2009

10)

Since the introduction of successful mobile money implementations such as G-Cash in the Philippines and M-Pesa in Kenya, many have been eagerly investigating the reasons that such services fare better in some markets than others.

In my experience, a successful implementation is largely dependent on the existence of certain market factors that create an enabling environment for the rapid penetration of mobile money. Since most of the benefits of a mobile money project are only realized when a critical mass of users transact, I think it's worthwhile to explore these factors in more detail.

1) High Penetration of Mobile: Quite obviously, since mobile money services will be offered through the mobile, it helps to address a market that is already comfortable using mobile technology. Although consumer education programs will likely still be required, you may be surprised at how quickly users will learn to use a new service when they are comfortable with the basics. In most emerging markets, the mobile operator has established a strong and trusted brand and this can easily be leveraged to introduce mobile money transfer or mobile banking.

2) Limited Access to Financial Services: In markets where access to banking, credit

I was recently asked if regulators are catching up with the innovations of Mobile Money in Africa. In my experience, we have seen some positive steps being taken by regulators to facilitate the introduction of Mobile Money but there is still a long way to go. I am encouraged by the interest that regulators are taking in this industry but I believe there is a fine balance between open regulation to create an enabling environment and strict regulation to reduce risk.

In countries where regulatory policy for mobile money implementations is limited, often a good starting point is to investigate the policies that Money Service Providers are regulated under and then determine how these policies can be adjusted to apply to electronic transfers.

As the industry evolves, regulators need to be fluid in their approach to Mobile Money so they can strike the right balance in their particular market. A key objective for the Regulator should be to maintain objectivity and avoid being cajoled into severe regulation from industry players that fear competition.

There's been a lot of debate around the 'right' technology choice for a mobile money implementation. In this post, I'll describe the various channel options and outline the trade-offs between them.

1) SIM Browser or SIM Application Toolkit (STK): This option is probably the most popular since it is quite secure, offers good usability, and works well on low cost handsets. An application is programmed onto the SIM to present a menu to the user and obtain the user's input. Transactions are usually passed through encrypted SMS. This option is only available on GSM networks and usually requires swapping the user's SIM for one with the application on it.
2) Mobile Internet: Uses GPRS, 3G etc. for communication from the handset to the mobile money platform. This option is not very feasible when mobile internet channels do not cover the entire network or in areas where the penetration of mobile internet enabled handsets is low.
3) Structured SMS: This option is a very simple and straightforward implementation involving a direct connection between the mobile money platform and an SMS gateway. Standard SMS messages are used to transmit the mobile money transactions which means no specific application is

"I think a lot of mobile money programmes fail because they have the technology, but they haven’t done the hard work of getting the agents in place.” - Michael Joseph, CEO Safaricom

I think Michael is right. Many of my clients have asked for help with taking their mobile money implementations to the next level. Almost always, the first thing I notice is that they have done a fantastic job of implementing the technology but have not spent nearly as much effort as they need to on building their distribution network.

M-PESA, one of the most successful mobile money implementations in the world, has been live for a little over 2 years and already has over 11,000 agents.

So, what are some of the tactics you can use to build your agency network? Firstly, look for existing distribution networks that you can leverage. Mobile operators have built sophisticated, wide-spread dealer hierarchies to support their core business and this may be an excellent place to start. Secondly, develop a standard registration & training process that can be easily replicated by a team that is focused on your roll-out. And finally, remember to keep your customer at the forefront.