Mobile Money: The next global communications platform

By Alix Murphy

Mobile money is on a journey. What started as a simple way of paying people using a phone is on the cusp of becoming the next global communications platform. Not just a means of buying goods and services, but a way of connecting with other human beings.

To understand what is coming next, we need to look back at where this journey began.

Long before coins and paper money existed, people exchanged handwritten notes that contained a promise to pay, including details of how that payment would be made, the timescale and other terms. The dialogue was far richer than we see on today’s banknotes.

Eventually nations developed their own formal monetary systems. However, they remained fundamentally local dialects. Some countries opted for Dollars or Dinars, while others knew only Francs or Shillings.

When the time came to move money between countries, it was a messaging company – the telegram operator Western Union – that took care of the movement and the ‘translation’ from one currency to another.

The arrival of mobile money services in the early 21st century marked another step forward, but these too were local. Today there are more than 260 different mobile money services internationally, and few are interoperable.

Our company, WorldRemit, is performing the role of translator – enabling people around the world to send money instantly from their smartphone to EcoCash, M-Pesa, MTN Mobile money, Airtel Money, Tigo Pesa, Zaad and others. Transfers to most countries are instant because we make it possible for people to send money like an instant message.

The speed and convenience of a true mobile to mobile service has proved incredibly popular with diasporas sending money home. More than half of all WorldRemit money transfers to Africa now go to mobile money accounts.

And we are seeing fascinating behavioral trends emerge. People are using mobile money transfers more like they use instant messaging than traditional remittance services.

In those countries where we offer both cash pickup and mobile money transfer, people send smaller amounts to mobile money (average between US$ 100), but they send much more often (average 3 times per month).

Why these radically different sending patterns? Our customers have answered that question. Rather than sending lump sums once or twice a month for general expenses, they are sending money to mobile wallets in response to specific requests – buying groceries, a household bill, a meal – following conversations with their recipient.

They do this, because they can. With WorldRemit, the money is transferred instantly and costs as little as US$ 1.50.

As one WorldRemit recipient, Stellah in Uganda said, “It feels like someone is just next door to you, just in case you need something.