Leaders in Mobile Banking and Payments
T A K I N G T H E W O R L D B Y S T O R M :
M O B I L E B A N K I N G
0 2 W h y P l a n n i n g F a i l s
Leaders in Mobile Banking and Payments
T A K I N G T H E W O R L D B Y S T O R M :
M O B I L E B A N K I N G
H a n n e s v a n R e n s b u r g
M o b i l e b a n k i n g t h o u g h t s
D e c e m b e r 2 0 1 0
2
© 2009 Fundamo. All rights reserved.
Some background on Fundamo
Founded in 2000 and one
of the pioneers of mobile
banking
Leading industry experts
Oldest deployment still
operational: Celpay
Zambia (2002)
Major brands incorporate
Fundamo as part of their
offering: (Gemalto,
Accenture, IBM, S1, etc.)
Five years of consecutive
spectacular growth
Clients in thirty-five
countries and offices in five
Mobile banking is probably the most important revolution in the history of banking
© 2009 Fundamo. All rights reserved.
Sufficient data can be found from analysts
to show that consumers prefer mobile
banking and that this is growing
Mobile phones changed the way that we
live, work and interact with each other
spectacularly and fundamentally
The role of banks as the guardians of
money are not as protected by regulations
anymore
The roles of banks and their relevance are
being questioned by all stakeholders
3
Banking will change during the next few years
© 2009 Fundamo. All rights reserved.
Successful banks will redefine their business
model, others will disappear
New business and operating models
Non-traditional competition
Stronger weight for emerging market players
Domestic consolidation in developed markets
New sources of revenue growth
Robust customer management
4
Banking 2012: Time for Bold Moves. New Operating Models to Rebuild Bank Profitability - Accenture research
Mobile banking is not another form of online banking
© 2009 Fundamo. All rights reserved.
Implementing online banking solutions on a mobile phone form
factor cannot be seen as mobile banking
Reach a much bigger percentage of the population
Serve the needs of consumers without any constraint of time or
location
Message-based transactional architecture rather than session
based, content-rich service
It is possible to implement much higher levels of security on
mobile phones
Utilising the unique characteristics of mobile phones rather than
porting existing services to a phone
5
Unique characteristics of mobile phones that can be leveraged by banks
© 2009 Fundamo. All rights reserved.
The majority of mobile banking solutions have not incorporated
many of the unique features of mobile phones
A few alternative channel to internet connectivity
Ideal platform to implement dual authentication
A convenient and cost-effective way to distribute bank-grade
encryption keys
The most effective way to associate a very unique and personal
identification of consumers to their banking portfolio
Ability to integrate services with other banking channels
6
Banks are competing with non-banks for market-share
© 2009 Fundamo. All rights reserved.
Regulatory dispensations are not going to provide the same
level of protection any more
Mobile network operators have the means, the opportunity and
the track record to provide financial services and they see this
as a means to retain consumer revenue
Digital companies are extremely well-positioned to offer
payment services to a large market segment that will define their
future banking relationships
Foreign banks can offer financial services remotely into
traditional markets of existing banks
7
So, how important is NFC?
© 2009 Fundamo. All rights reserved.
While one cannot ignore the importance of NFC, the hype
surrounding it is distracting attention from the important issues
The business model for the investment required is at best
marginal
The infrastructure required to ensure mainstream adoption is
further into the future than most observers predict
The complexity of the security architecture and the contractual
liability is not defined well enough to be deployed as a
mainstream solution.
8
Aug 2006 Technology Review published by MIT predicts that 50% of new phones shipped in 2011 will be NFC enabled
What are the secrets that nobody tells you about NFC?
© 2009 Fundamo. All rights reserved.
NFC solutions are not simply a matter of starting to issue a new
type of payment instrument
Banks will most probably have to implement new (or at least
upgrade existing) back-office payment infrastructure
The existing AML and compliance management systems will not
be able to cope with the new profile of transactions
Back office procedures will require a major re-design to cater for
concepts like personalisation, secure element management etc.
Approaching the reality of mobile banking in a well-architected
way, utilising state of the art payment platforms will prepare
banks best for NFC
9
© 2009 Fundamo. All rights reserved.
10
The emerging market revolution
End of
Year
Access Subs
2008 60 10
2009 150 35
2010 280 65
2011 450 110
2012 670 180
2013 1 000 300
2014 1 200 5002008 2009 2010 2011 2012 2013 2014
Massive growth in subscriber numbers and transaction volumes in many emerging countries
Learning and applying new business models, regulatory dispensations and technology solutions
A major driver for financial empowerment
Lessons from emerging markets for first world countries
© 2009 Fundamo. All rights reserved.
Emerging markets were the perfect testing ground for
many of the techniques and concepts of modern
mobile banking
Technology platforms could be tested and refined to
cater for the extremely high volumes of transactions of
these deployments
New business models emerged that can be applied in
first world markets to generate profits and reduce
costs
Emerging markets are often tightly integrated to
developed markets through trade and migrant workers
11
Show me the money
© 2009 Fundamo. All rights reserved.
Mobile banking without a clear strategy to meet business
objectives should not be attempted
Develop new sources of revenue through new types of
transactions and the retention of funds
Reduce costs by fundamentally redefining business processes
Increase consumer loyalty and grow market-share especially in
non-traditional market segments
Build networks with other banks and third parties to entrench
value contribution
Reduce fraud and increase security, by managing specific risks
12
© 2009 Fundamo. All rights reserved.
13
I thank you for the opportunity to share this with you
Hannes van Rensburg
CEO: Fundamo
http://www.fundamo.com
http://mbanking.blogspot.com
@Rensburg on Twitter
Top Related