The Mobile Money Movement: Catalyst to Jump-Start Emerging Markets

Abstract

There is something profound taking place in emerging markets with mobile money movement... it is now a “Mobile Money Movement” with the potential to substantially alter the economic paths of the poor and emerging economies at large. For this reason private and public sectors alike are now taking notice of this industry. Mobile finance is becoming an increasingly important topic for The World Economic Forum and for the G20 summit. Nearly 2/3 of the world’s population lives in poverty: four billion people live on less than $8.00 USD per day. Most do not have bank accounts, but do have mobile phones (1.7 billion people by 2012.) Mobile money provides an opportunity for financial inclusion to the unbanked base of the economic pyramid - the majority of the global population who has lived in the informal financial sector and who has relied on cash to conduct all financial transactions. As such, they lack access to credit, insurance, and savings. This wave of mobile money momentum, if not slowed down by other challenges inherent in these markets, will undoubtedly positively impact the course of economic growth in emerging markets for a number of reasons that are inherent within mobile money itself. Mobile money will spur economic growth in emerging markets because of the forces inherent to mobile money itself. Specifically, these forces include: 1. the ubiquity of data transmission that mobile provides; 2. mobile money as a new industry; 3. mobile money as an infrastructure supporting new businesses and other industries; 4. the infusion of new capital from the informal sector; and 5. the efficiency gains that digitization of money enables