Mobile banking interoperability is a far-reaching vision that promises to improve financial inclusion by leaps and bounds. Clients cannot transfer funds between money wallets associated with different telecom companies, which reduces liquidity in the financial system. Despite this, mobile banking providers are reluctant to collaborate with competitors fearing a decline in market share.
A recent article by Ignacio Mas at the CGAP Blog discusses the importance of interoperability in this context and suggests a few suggestions for mobile phone operators who are currently unwilling to let other carriers tap into their mobile banking solutions.
Mas highlight two types of players in the mobile banking ecosystem who stand to benefit from such a shift in industry dynamics:
- Mobile banking customers, both individuals and corporations, who may currently deal with the lack of mobile banking interoperability by signing up for different service providers themselves. Inconvenience and high costs are two hurdles in this regard, and
- Merchants who play the role of mobile banking agents, often servicing subscribers of different telecom companies under one roof.
Apart from these, the mobile money carriers can leverage such a partnership strategically by viewing it as an investment in their distribution channel, which will ultimately ‘maximize the total size of the pie’.
Click here to read the article.
