Emerging markets remain the best bet for mobile money services, according to research firm Berg Insight.
The company predicts the number of active users of mobile money services in emerging markets will grow at a CAGR of 36% to 381 million by end 2017, up from 61 million users at end 2011.
“The industry is in a very exciting phase right now,” states Lars Kurkinen, telecom analyst with the firm. “Mobile money has not only taken off in Kenya – we’re seeing exponential growth in Tanzania, Uganda and several other countries as well.”
Despite African nation’s dominance of mobile money services to-date, Berg Insight predicts Asia Pacific will overtake the region by 2017, accounting for close to 66% of the world’s user base by that point. Services have already launched in Bangladesh, Pakistan, India, and Nigeria, Kurkinen notes. Mexico and Argentina also have services up and running.
Many commentators have noted that mobile money services are experiencing slow pick up in developed markets. Tony Poulos, market strategist for the TM Forum, recently noted that the market has a long road ahead in terms of overcoming regulatory hurdles, and that the value proposition remains uncertain.
Berg Insight paints a different picture. It predicts the total value of mobile money transactions will grow from $44 billion in 2011 to $395 billion in 2017. While the firm concedes the services remain most attractive to unbanked users in emerging markets, it also predicts a role as the primary self-service banking method for people with bank accounts.
"Mobile money is reshaping the market for products such as micro insurance, and will drive uptake of electronic payments for goods and services in many emerging economies,” Kurkinen says.