What are the executive perspectives for understanding mobile money in emerging markets, and will the same apply to executives in established countries?

Executives in emerging mobile money markets need to contend with the sometimes limited infrastructure in these areas, the various languages used, and other regional factors like the political climate. In the industrialized world, similar principles can apply when reaching out to impoverished communities, who may also have unstable infrastructure.

Expert Answers

An illustration of the letter 'A' in a speech bubbles

In developed markets, mobile money has been emerging slowly as a technological alternative or convenience for people who already are connected to the banking system. In emerging markets, however, there is a leapfrogging phenomenon in which people's first connections to finance in any form is via mobile money.

The key opportunities in mobile money involve reaching large numbers of unbanked people who are new entrants into Africa's middle classes, defined as those living on over $3.90 per day. This group needs a spectrum of services, including banking, mobile payments, the ability to send mobile money, and small loans. The applications designed for them need to take place in an environment which may have limited infrastructure, multiple languages, and low literacy rates.

According to Quartz:

Sub-Saharan Africa ...is currently responsible for an astonishing 45.6% of mobile money activity in the world.

This means that executives need to address the issue of a potentially massive market which often consists of numerous small transactions within a region with logistical and political difficulties. For example, an obstacle to the use of mobile money is availability of power, and thus mobile operators might need to invest in kiosks with solar power to help customers use their phones.

Executives in developed markets can learn from the rapid financial tech innovations in emerging markets. They can use these innovations to reach people living in poverty in the developed world and also to reach out to young people who own phones but are just entering the world of finance.

Approved by eNotes Editorial Team