The Future of Mobile Banking

CGAP and DFID teamed up on a brand new report peering into the future of "branchless banking," which they define as the delivery of financial services in essentially any way other than through the traditional brick and mortar bank branch.  A big component of branchless banking is, of course, mBanking-- banking with your mobile phone.

The paper asks what governments and the private sector can do to affect the development and uptake of branchless banking in the next ten years, looking at the forces and uncertainties that will most strongly affect this progress. Then they conduct an interesting thought experiment, laying out four scenarios, in four imaginary countries, exploring the ways varying actions taken by the government and the private sector affect the growth of branchless banking.  It makes for pretty interesting reading.

The basic conclusion of the paper is that there is massive, latent, underserved demand for mobile/branchless banking, and if mobile operators, banks, and governments can work harmoniously to create a legal regime that is clear and stable, a policy environment that supports innovation and experimentation, and products that are  functional and secure, we'll see widespread adoption of mobile and branchless banking in the coming decade. It may not happen immediately, so mobile operators and banks will have to be patient with their investments, but it's hard to imagine it not happening.

I think they're right about this. Because, here's what I'm thinking: Four billion people on earth have mobile phones, and four billion people are "unbanked." That means, roughly, that two billion people have a mobile phone and no bank.  The market is there, the demand is there-- who's going to figure it out?