Editor’s note:This article contributed by Alix Murphy of WorldRemit gives insight into opportunities around Mobile money,FinTech and financial inclusion for 2016
The Top 3 Predictions for FinTech, Mobile Money and Financial Inclusion in 2016 are:
1. Financial inclusion will mean big business. Making serious money and reaching the unbanked have not always gone hand-in-hand. We’re now witnessing a major shift in thinking as big name players in payments and other industries are talking openly about the huge opportunity in reaching unbanked customers – and not just as a corporate social responsibility gimmick. PayPal, Walmart and Coca Cola are just a few companies to pursue innovative financing for small businesses and products targeted towards under-served consumers, while a swathe of new payments start-ups have taken on financial inclusion as a goal. What’s more, digital payments are now being actively promoted by global policymakers as critical to economic stability and financial inclusion for the world’s poorest.
2. 2016’s biggest fintech innovations will come from the developing world.Forget about contactless payments apps and challenger banks: The real life-changing innovation is not happening in the developed world but in emerging market economies.FinTech heavyweights in areas like m-Insurance, microloans and Mobile Money – a financial service for unbanked people using just a basic mobile phone – are transforming lives, businesses and whole economies across Africa, Asia and LatinAmerica. Mobile Money in particular has become the foundation for a range of other innovative financial products like life and health insurance coverage paid for by topping up prepaid airtime, interest-bearing savings accounts for non-banked customers, instant personal and small-business micro-loans, and even investment bonds bought through a mobile phone. 2016 will bring wider acknowledgement among fintech companies in Europe and North America of the lessons and experience to be gleaned from their peers in the developing world.
3. Mobile-to-mobile will be the benchmark for international money transfers. In 2016, international remittances are expected to rise to over $600 billion, but most are still sent in cash informally or via risky high-street agents.As Mobile Money continues to gain popularity in the developing world, instant mobile-to-mobile transfers will become the global standard for sending money from person to person across distances. 2015 saw a series of ground-breaking partnerships between Africa’s largest telcos, banks and global money transfer apps like WorldRemit. This trend will continue through 2016 as consumer expectations settle on instant mobile-to-mobile transfers as the benchmark for international remittance.
About the Author
Alix Murphy, Senior Mobile Analyst, WorldRemit A leading Mobile Money specialist, Alix helps build and support commercial relationships with telecoms operators all over the world. Before WorldRemit, Alix was at the GSMA, where she analysed trends in Mobile Money and digital identity, and consulted mobile operators on revenue opportunities.
She has on-the-ground expertise of the telecoms sector in regions as diverse as sub-Saharan Africa, Latin America, North America, East Asia and South East Asia. In her early career, Alix spent several years in international development, including at the Grameen Foundation and Aga Khan Foundation.