Day one, was focussed more on the setting forth the importance of Mobile Commerce with a special focus on India. Deepak was a speaker on this day with the session on Unleashing the potential of mobile money in India: what does mobile money mean for the Indian market? Deliberation on the current state of mobile money transfer services in South Asia was done with the intent of identifying customer needs to better target the market. Queries about the M-Payment services and its mechanism were also resolved.

Day two had a stronger focus on the business perspective of mobile commerce. Sustainable business models were discussed and partnerships between bank and telecom companies were seen as successful example learning from application in Bangladesh.

There also was a Regulator’s armchair session with Shri Srinivas, General Manager, Reserve Bank of India & Mr. Inayat Hussain, Executive Director, Banking Policy & Regulations Group, State Bank of Pakistan, where the regulators answered queries about the laws and statutes governing mobile commerce in the region.

The exclusive event was attended on both days by invitees from the mobile commerce space. Attendees included representative of mobile network operators, banks and MFIs.

Deepak took the stage in the first session of the day unlocking the potential of mobile money in South Asia. The panel included eminent executives representing large corporations keenly looking at the mobile money potential in South Asia. They included Gary Singh, MD, Nokia Money; Krishna Kumar, GM Marketing Mobile commerce, Vodafone Essar and Rahul Joshi, Joint General Manager, ICICI Bank.

Current state of mobile payment in the region was seen through the lens of banks and MNO’s. The panel identified trends and hot spots, opportunities for mobile money services, existing mobile banking mechanisms and recognized obstacles facing full deployment of the mobile money ecosystem. Deepak mentioned Obopay’s presence in Kenya, and the rapid growth of adoption in the Indian market. He also emphasized on the huge underserved unbanked segment in India.

Deepak in his address in the pre-lunch session focussed on the Indian market. He concluded that India will have the largest base of mobile financial services users, multiple times the numbers that we see today in markets such as Kenya and the Philippines.

Together with the World Economic Forum (WEF), at part of IdeasLab, Obopay has published a video and an accompanying paper to discuss the opportunity for Universal Mobile Money and how best to address the challenges of making it a reality through an Open Collaborative Model. You can view the video and paper at the links below:

Universal Mobile Money Video:
http://www.weforum.org/content/mobile-financial-services-all

Universal Mobile Money Paper:
http://slidesha.re/o50nSB

It is hard to know exactly the contribution each Davos meeting makes to the world – but I believe it is significant. It takes people out of their day-to-day routine and gets them talking to a diverse group of influencers from all over the world and all walks of life.

In “Three Wishes for Davos; Inclusive Growth, Support Entrepreneurship, Empower Women”. I offered my hopes for the conference in these three specific areas.

When I did arrive at Davos I had the pleasure of meeting and learning about some of the amazing entrepreneurs from the Technology Pioneers.  Elisabeth de los Pinos was one of the most remarkable and I talked about what she is trying to accomplish in “The Rock Stars at Davos”.

Financial inclusion, one of my passions, was the subject of a number of sessions.  In “Davos Hot Topic — Inclusive Growth Through Mobile Banking” , I covered some of the highlights and lowlights presented during the week.

I heard a number of success stories during the week, but none more inspiring than Brij Kothari and his PlanetRead.  Hopefully, you will enjoy it as much as I did in “Davos — Bollywood Brings Literacy to Millions”

When the week was finished, I tried to sort out what I had seen and heard through the eyes of a Technology Pioneer.  What I came up with was “A Technology Pioneer’s Top 10 of Davos“.

I encourage you to send me comments or questions on any of these blogs.  Hopefully, they help form a small picture and set of insights into one of the most incredible conferences I’ve ever attended.

Now we’re at a new threshold and my role needs to change.   I saw this next step in our evolution over two years ago, and knew that there was going to be a need for additional leadership—one focused on scaling the business that would complement my vision and my job to focus the corporate strategy.   We have grown in all three continents where the company does business. We have taken the company into northern and eastern Africa, through expanded relationships with Societe Generale and Essar.  In India, we have a strong program with Nokia, and a new relationship with Union Bank of India.  In the U.S., we have expanded partnerships with STAR Networks and MasterCard, while providing new mobile payment products that can be implemented by financial institutions. (The picture above is our lobby headquarters gallery of flags of the countries where Obopay operates mobile money services. We will be adding many more flags this year.)

We have global partnerships with some of the best companies in the world to scale the solutions and make them true mass market offerings. We have employees around the world scaling the business within the countries we operate and into new countries. I am proud of how far we have come and excited about the momentum as we enter 2011.

During the past six months, Deepak Chandnani has served as President of Obopay, and has done a tremendous job. Much of our annual growth came under his leadership.  His efforts during this period have also laid a foundation for a very promising 2011.  Therefore, I am pleased to announce that the Obopay Board of Directors, unanimously approved my recommendation to promote Deepak to CEO of Obopay. Click here for the link to the public announcement of Deepak’s new role. (The picture above is at the all hands meeting at Obopay’s Bangalore office. The team is congratulating Deepak on his promotion. The US team is participating virtually via video conference screen which is visible in the upper right hand corner of the picture.)

I will assume the role of Executive Chairman and work in partnership with Deepak to realize the vision and potential of Obopay.  I believe strongly that there is an opportunity to keep Obopay in a global leadership position, not only in terms of growth, but in terms of driving and shaping the issues that will accelerate the promotion and adoption of mobile payments.  I have worked hard to develop the beginnings of an international reputation in thought leadership that puts Obopay side by side with the leaders of global financial, telecommunications and government.  But that work, like our growth, has to accelerate dramatically.  I will continue to provide strategy and vision for the business and continue evangelizing mobile money and Obopay’s leadership. I look forward to working with Deepak in his new role. He and I make a strong team.

Deepak has clearly demonstrated that he can move the company in the right direction as we continue our growth around the world.  This promotion provides recognition for the job he has done and fulfills a need for an expanded and experienced management team as we move forward. Under Deepak’s leadership our revenue has doubled this past year and we expect it to double again.

Please join me in congratulating Deepak on his new role. I am excited about my new role to working closely with the Obopay team and world class partners to realize the potential of mobile money.

Kenya – the Silicon Valley of Mobile Banking and Payments

Kenya is at the threshold of fast-paced growth next year, according to the World Bank. This year Kenya repeatedly demonstrated leadership in Mobile Money and this latest announcement from Essar’s YU and Equity Bank reaffirms Kenya’s status as the “Silicon Valley” of mobile banking and payments.

Over 70% of all households in Kenya use mobile money. Each mobile network operator offers a mobile money service. Safaricom and mPesa are the best known, but there are others including YU Cash by Obopay and it is becoming a very competitive market which is pushing providers to bring mobile money services to the next level in order to meet demand and compete for customers. Yesterday, YU and its innovation partner, Equity Bank, upped the ante by announcing new functionality made possible by offering mobile money customers the ability to access their service directly from a full service Equity Bank account. This is a concept that we at Obopay call a “mapped bank account”. It provides the customer with the choice of a full service bank account, complete with mobile money services, with the ability to transact directly from that account, rather than through a separate mobile account.  .

How does Mobile Money work in Kenya?

Mobile Money is transforming Kenya. 3 years ago it was a typical cash centric emerging market whereby most consumer transactions were cash based. Then almost overnight things changed when Safaricom offered its customer’s a “mobile wallet” to store money, send money, and pay for things directly from the phone. Other mobile operators have now followed suit and provided similar capability, and it has become a must have service.

Here is how it works – users sign up at a retail location where they previously went to purchase mobile phones or prepaid airtime minutes. Once enrolled, they can load money directly on their phone by giving participating agents/retailer cash over the counter. If they need to withdraw money, they can go to any authorized agent/retailer and get cash out of their mobile phone account. The first thing people in Kenya did was use the service to send money to family members – lots of people work in the cities but have family members in rural areas. Since there are retailers supporting this everywhere – it was the fastest, safest, and most reliable way to send money overnight. It started with money transfer but now people use their mobile money to buy prepaid minutes, pay bills, buy online, and buy at stores, as a way to save money and enhance their personal security by removing the need to carry cash.

Statistics from Central Bank of Kenya indicate that remittance flows in September, 2010, increased by 12.6 per cent to $ 58.6 million, from $ 52 million in August 2010 and were 17.1 percent above the cumulative 12 months average of $ 50 million a month.

What is a mapped bank account?

Before today, most Kenya users of mobile money were limited to using money in the mobile accounts. If they had bank accounts it wasn’t easy to use the money they already had in the bank. Also, if they wanted to “upgrade” and have more services from a bank, which many of them do, that wasn’t easy.

Some providers allowed electronic transfer between bank accounts and mobile accounts – but that could take an extra step, take hours or days, and could involve extra fees.  The term we use at Obopay for this type of money movement is a “linked bank account” or a “linked card”. This is very useful since users may want to have my different accounts “linked” so I can move money between them.

At Obopay, we think “linked accounts” are necessary – but insufficient for many users. Users want the option to have full service banking and to transact directly off of their preferred account – and we deliver it via a “mapped bank accounts”.

A mapped account is a traditional bank account “mapped” to my mobile. The account has all the features the bank wants to offer AND allows the user to receive, send, or pay directly from that bank account. In addition to allowing the user to also have direct access to traditional bank accounts from their mobile. It also allows instant money movement between the traditional bank account and the mobile account. So if a user wants to use both – then they have lots of options in how they manage and spend money.

Obopay, the global leader in mobile payments, is an innovator in both mobile and mapped bank accounts. It is especially important in markets like Kenya where people often don’t live near banks. Now, with Mapped Bank accounts they can have all the services they need or want from a bank via a mobile phone.

Mobile accounts have brought limited banking to large underserved communities, mapped bank accounts in combination with mobile accounts will add full service banking to these same large underserved communities.

Obopay could not have accomplished this without great partners like Equity Bank and YU. We are proud to work with them to bring the full power of mobile and banking in an inclusive way.

Links to Press Articles

http://www.capitalfm.co.ke/business/Kenyabusiness/Banks-plan-to-tap-mobile-money-5135.html

http://www.businessdailyafrica.com/Corporate%20News/Equity%20links%20up%20with%20Essar%20for%20diaspora%20cash%20transfer/-/539550/1065390/-/sw7h4t/-/

Last week I was at the Gates Foundation’s Global Savings Forum. I participated on a panel which included Bill Gates and covered “New Partnerships for Technology-Enabled Financial Inclusion”.  The interest from Bill and Melinda Gates was personal – they had witnessed how people living on $2 a day or less around the world need an easy, safe and affordable place to save and build financial security for their future. Bill and Melinda knew that to make global financial inclusion a reality, they would need many organizations working together from both public and private sectors – therefore the Global Savings Forum was established.

Ignacio Mas, Deputy Director of the Financial Services for the Poor at the Gates Foundation, moderated the panel. Panelist included Bill Gates and luminaries from different types of organizations; Ignacio challenged us to speak frankly about partnerships needed to reach and serve the poor. Not a surprise that 3 of the 7 panelists – Michael Joseph (Safaricom CEO), Dr. James Mwangi (CEO Equity Bank), and myself -  are directly involved with mobile payments in Kenya. Kenya is the Silicon Valley of Mobile Money – where 14 Million of the 39 Million Kenyans have mobile money and use it in their daily lives.

Bill set the tone by making it clear that “technology should be able to help the poor participate in the greater economy”. Michael Joseph emphasized the importance of the mobile carrier – who has distribution that is key to reach, and customer trust that is key to adoption. Dr. Mwangi believes mobile is changing banking in a big way and the partnerships between banks and mobile carriers bring scale and cost efficiency. Interestingly Equity Bank has partnerships with at least three mobile carriers in Kenya – including Safaricom(mPesa) and YU (YUCash by Obopay).

Equity and Safaricom talked about their partnership around a co-branded savings product in Kenya. “Strategically working with Safaricom was a no brainer. This is one of the best decisions Equity Bank made!”, Dr. Mwangi told the group.  Michael Josephs agreed. Yet it was clear that the two of them had to be heavily involved in forging the terms of the agreement over many many coffee meetings.

I advocated for an open collaborative model, and emphasized that scale will come from a rich ecosystem of partners. A question from the audience was – “who should get it started then?” My answer was that there is no right answer except whoever starts it needs to be bold and be a market maker. Then build an ecosystem around what they are doing. Safaricom did that in Kenya.

In general, we find that our partners have been successful because they recognize the importance of  being an early movers and taking the market making role. More and more they understand early that it is an ecosystem they are building and move quickly to recruit local partners who share their desire to scale.

We see this happening everywhere we work in the world.  We are partnering with mobile handset manufacturers, non-bank financial providers, and retailers. It is a whole new ecosystem unfolding around mobile money. This ecosystem creates greater reach, a fuller range of offerings, and encourages innovation in the mobile money space.

Certainly, there is a tremendous need for these solutions.  Globally 5 billion people have phones, but only 1.5 billion have good access to financial services. Those people still depend on cash, a costly alternative where studies have shown that as much as 20% of the cash is lost or stolen. This impacts families, small businesses, surrounding communities, and hampers economic development. It was clear from this meeting that Bill, and especially Melinda, have a real commitment to create technology-enabled savings for those who need it most.  And that commitment will certainly accelerate financial inclusion around the world.  Bringing together key players from all over the world is certainly a great beginning.  It was clear that the Gates will keep a focus on the very bottom of the pyramid – on those with the greatest need.  As you know from these posts, it’s a passion of mine and one of the clear goals for Obopay.   I was honored to be part of their first Global Savings Forum.

Global Savings Forum Obopay White paper:

http://slidesha.re/d81QMA

Carol Realini’s Presentation from the Global Savings Forum:

http://slidesha.re/8ZZ68h

As you know, our quest at Obopay is to use the ubiquity of mobile phones to deliver financial services to those who have traditionally been underserved.  We do this in partnership with mobile carrier, banks, mobile phone providers, and retailers.  Interestingly, our partnership with each of these players has given us a unique insight which is that Collaboration is critical.  An open, trusted, scalable and interoperable model is essential to maximize reach and deliver the broadest range of financial service offerings. Also that UDI and disbursements will ensure key cost elements are reduced and drive larger adoption – accelerating the “network effect” for those with the greatest need.

I have always believed that an Open Collaborative Model will achieve the benefit of more financial offerings and more choice when branchless banking scales.  It is certainly where I have seen the most success:

• Interoperable multiple mobile banking/payment providers. It is essential to have multiple providers which include both bank and non-bank participants. If they interoperate (allow payments between their respective participants) this will drive greater adoption and usage, much like carrier-based text messaging (SMS) enjoyed when it became interoperable.  It is essential that these players recognize the tangible benefits that accrue to the market as a whole, while benefiting each of them individually.

• Broadbased Agent Networks with connections to traditional banking and payment infrastructure. Agent networks need to reach people where they live and work and  connect to the traditional banking and payment infrastructure. Financial solutions are not silos. Much like the internet, the value increases with the number of participants and contributors. Agent networks are critical to reach the underserved; traditional connections are key to the participation of the traditionally served community.

• Open Access. It is important to offer choice and encourage innovation in financial services. An open “marketplace” or “appstore” for Mobile Financial Services that gives the users choice. All people deserve access to quality and choice in their financial services. Open approaches will encourage innovation.

• Merchant acceptance interoperability. Building enough places to pay is essential for the growth of mobile financial services. Small and micro business adoption is essential to usefulness. Those businesses benefit more if they are able to serve more of their customers – therefore merchant acceptance of multiple mobile bank solutions will increase value to the SME and value for users.

Such a model empowers life and work by making financial services more accessible and affordable while providing a full range of offerings that are user focused even in the most challenging market scenarios.  Users can start with simpler, immediate needs and graduate to savings, micro loans and micro-insurance products.

Once a network is established (critical mass of agents, merchants, consumers, financial offerings), the Open Collaborative Model will encourage highest value, more choice, more innovation and more utility.

There is great interest from the private sector in investment for mobile financial services. Yet these investments, absent an open collaborative approach will achieve only a fraction of their potential. In a world where half the adult population lacks affordable and convenient access to simple banking, we owe it to the underserved to move quickly to this model. What is at stake is inclusive growth and empowerment of the poor.

I look forward to exploring these ideas with you in the days and weeks ahead, and I welcome your comments and thoughts in the comments section below.

http://www.forumblog.org/blog/2010/11/more-with-less-for-more-indias-global-leadership.html

http://www.forumblog.org/blog/2010/11/implementing-india-the-financial-inclusion-opportunity.html