Mobile banking and payments are a growing part of the commercial landscape. Also a popular and cost-effective way to mainstream the financially underserved. Especially here in the U.S.
According to the Federal Reserve Board, 90% of underbanked Americans have mobile phones and 49% of those consumers had used mobile devices to conduct banking during the 12-months leading up to November 2012 that was up from 29% a year earlier. The Fed's report also reveals that about one in three unbanked Americans
has a smartphone, which makes these individuals candidates for mobile
The Fed's data was contained in a report on mobile financial services released last week, the second such report out of the Fed in as many years.
That mobile phones can help mainstream the financially underserved is pretty much a no-brainer. What's fascinating, however, is how many different types of payments can be facilitated by mobile technologies.
Last month, while attending the Bank Administration Institute's Payments Connect conference I had an opportunity to witness a demonstration of one of the newest twists in mobile financial services: a mobile cash payment option called PayNearMe.
PayNearMe began as an online cash payment option; sellers render bar code receipts which buyers can then have scanned at thousands of payment locations (mostly 7-Eleven stores). Now it's being made available to brick and mortar merchants who can have bar-coded receipts sent to customers' mobiles. Greyhound bus lines was among the first to sign on. Several property management companies are using the service too, for rent collections, said Danny Shader, PayNearMe's CEO.
"Our passengers represent a wide cross-section of the public, but the one thing they have in common is their smart phones," said Dave Leach, Greyhound's President and CEO.
Some Women Remain Underserved
While mobile phones may be responsible for helping to mainstream the financially underserved in the U.S., that's not necessarily the case in other countries.
A new report from card company Visa and GSMA, an international association representing mobile companies, reveals that women in developing countries are a huge underserved market for mobile financial services. This despite the fact that women often handle household finances.
Daryl Collins, co-author of the report and a Director at the consultancy Bankable Frontier Associates,said the research shows that "low-income women undertake complex financial management for their households using a set of often substandard instruments."
Chris Locke, Managing Director at GSMA, said the research "clearly demonstrates that women play a critical role in the success of mobile financial services deployment."