Berg Insight’s figures on mobile banking reviewed

Rating: Never mind mobile banking what about the ‘unbanked’?

Amongst the innumerable analyst opinions that the purchase of Palm by HP was the best thing since sliced bread, a piece of research from Berg Insight on mobile banking appears to have been overlooked.

The company is predicting that the worldwide number of users of mobile banking and related services is forecasted to grow from 55 million users last year [ 2009] to 894 million users in 2015. Which is pretty impressive.

berg

The problem with such research is that these reports tend to be very ‘developed world’ centric. Take this example from Marcus Persson, who is a telecom analyst with Berg Insight.

“People who sign up for their first mobile subscription today will likely open their first bank account in the coming years and thus join the modern financial system,” he says.

“Mobile operators can play a vital role in this development and will have the opportunity to take an active part in the creation of some of tomorrow’s most important financial institutions based in Asia and Africa,” he adds.

GoMo News firmly believes that analysts like Berg Insight may be missing the bigger picture. Mobile phones will almost certainly be utilised for moving money around in developing markets but this could have very little to do with banks.

In fact, it’s the unbanked [those who don't have bank accounts] who will prove important in regions such as the Middle East and Africa. Berg Insight hasn’t missed this point.

In fact, Berg predicts here that 3 to 15 per cent of the international money transfers currently handled by various formal or informal agent networks will be carried out using a mobile handset by 2015.

The keywords here are “formal or informal.” Because Berg Insight suggests that such transfers will generate some $ 1.2 to $6.2 billion in service revenues.

And if the Banks aren’t involved in such activities then it is the mobile operators who will secure these revenues.

So if we go back to Berg’s figures again we will see that concentrating on banking might be a mistake.

Berg Insight forecasts that mobile banking will attract 115 million users in Europe and 86 million users in North America by 2015.

If you think about it, that’s not very many. Not compared to the millions in China, India, Russia, and Brazil who might suddenly find their mobile phones can pay bills.

GoMo News thoroughly agrees with Marcus Persson’s sentiments when he says that, “Mobile handsets are in an excellent position to become the primary digital channel for providers of banking and related financial services on emerging markets.”

What such analysis appears to overlook is the fact that even in Europe, in most countries the majority of mobile phone users are using prepaid handsets not contract phones.

And if you empower PAYG users to be able to pay bills without the necessity for a bank account, you could well be tapping into a vast unrecognised demand.

Tony is based in Surrey and is a veteran comms journalist. Tony also writes on the UK market… contact him here.

About Tony Dennis

Tony is currently Editor of GoMobile News. He's a veteran telecoms journalist who has previously worked for major printed and online titles. Follow him on Twitter @GoMoTweet.
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9 Responses to Berg Insight’s figures on mobile banking reviewed

  1. Pingback: Tweets that mention Berg Insight’s figures on mobile banking reviewed: Rating: Never mind mobile banking what about the ‘unbanked’? Am... -- Topsy.com

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  3. Eric Barbier says:

    >And if you empower PAYG users to be able to pay bills
    > without the necessity for a bank account, you could well
    > be tapping into a vast unrecognised demand.

    This is exactly what ‘s TransferTo (www.transfer-to.com) is enabling.

  4. I am sorry to say, but Tony has misunderstood our research and trying to write a story on just a short pressrelease. You can’t judge the report by just 15 lines in pressrelease. This report is handling the three areas mobile payments, banking and remittance.

    Here is what you got completely wrong Tony:

    1. This report is not developed world centric, but brings up the difference between developed markets and emerging markets for mobile banking and related services.

    2. We are not missing the bigger picture as you say. You would have to read our report of 130 pages to understand this.

    3. “The keywords here are “formal or informal.” Because Berg Insight suggests that such transfers will generate some $ 1.2 to $6.2 billion in service revenues. And if the Banks aren’t involved in such activities then it is the mobile operators who will secure these revenues.” -this part you got completely wrong. Please look up the meaning of informal money transfer networks….. The span we have for mobile remittance is becase we have done a scenrio analysis in the report.

    4. Tony- If you had called our analyst before you write an article you would have got everything right instead of making false conclusions.

    Tony Dennis replies: Sounds like you really need some help with writing press releases

  5. Tony Dennis says:

    Actually it sounds to me like your executive summaries are useless. Especially if journalists need to speak to the analyst every time they need to ascertain the “facts”. No journalist ever, ever “would have to read our report of 130 pages to understand this.” Change your PR firm.

  6. The facts are in the pressrelease and the executive summary that is generally available, it is just that you have misunderstood and drawn the wrong conclusions in some parts. You are not listning to the source of the content that you are using to better understand what you are writing about. I have never come across a journalist that would not be interested in listning when I am trying to explain and correct your misunderstanding (you are saying in your article that we are saying things that we are not saying). Mobile banking is indeed different in Emerging markets and Developing countries.

  7. Tony Dennis says:

    send your comments direct to my mailbox here

  8. Shanna says:

    It’s always a pleasure to hear from someone with epxtersie.

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