Virtual money, a new way of banking

FNB has confirmed a 49.3% increase in cellphone usage throughout Africa since 2002. This increase is largely contributed to the access of mobile operators and the technological investments made in Africa by the private sector. The impact mobile telephony has had on Africa has been revolutionary, and constantly new mobile innovations are emerging.

"The power of telephony has always been underestimated, with the launch of mobile phones in Africa, no-one expected the radical change it would create, and recently Africa has become one of the fastest-growing mobile markets on the globe," says FNB Smart Services CEO, Yolande Van Wyk.

With the advent of various mCommerce models namely; mCommerce, Mobile Money, Mobile Banking, access to and the facilitation of financial transactions and financial information has become a method and means of business for African entrepreneurs. Mobile banking services is rapidly creating a service-driven industry allowing consumers access to their financial information any time, anywhere.

Van Wyk explains that the growing use of mobile phones has opened the doors for innovative financial transactions to start taking place. With the mobile phone now acting as a virtual wallet, the ability to transact in even the remotest of locations is a reality. While the service itself sounds simple, the ecosystem behind it is what really makes it tick. It is the collective companies, networks, and agents that work behind the scenes that bring the services into the hands of the consumer. Once we have a complete network providing access into this ecosystem, true cashless transactions become a reality.

To date, FNB Smart Services has seen a significant growth in demand for paid-for content services, airtime transfer, mobile banking, merchant payments and even person-to-person money transfers. The FNB eWallet solution specifically, has seen a remarkable up-take in a very short period, predominantly because it speaks to people's needs to replace cash easily and safely. Since its inception in November 2009 more than 100,000 eWallets have been created with over R 80,000,000 been sent to friends and family from FNB accounts.

The reality is that mobile money offers everyone access, no matter the physical infrastructure around them, or their income bracket. It also dramatically reduces the costs of transactions as the negation of bricks and mortar services reduces the total cost of service provision; a cost saving that is then translated back into a benefit for the customer.

Van Wyk states that to effectively bring mobile banking solutions to the African market service providers need to bring the customer to the centre of the environment and make the stakeholders secondary. There is a need to place emphasis on partnerships, investigate interoperability, deploy incentives for users and partners, and deploy business models that reward qualified risks.