The sub-Saharan mobile money revolution is set to net providers such as telcos and banks as much as $1.5 billion in fees by 2019, according to research from the Boston Consulting Group (BCG).
Last month Bill Gates predicted that by 2030 two billion people who don't have a bank account today will be storing money and making payment with their mobile phones.
In sub-Saharan Africa the adoption of mobile money is already well underway and the opportunity for further growth is huge, says BCG. By 2019, the firm estimates that there will be 400 million mobile phone owners in the region with an income of at least $500 a year. Yet, just 150 million of these will have a traditional bank account, leaving 250 million open to mobile money providers.
So far, P2P and bill payments have dominated the mobile financial services market in Africa, and BCG estimates that fees from these activities - along with deposit income - could make $1.5 billion for providers in 2019.
However, perhaps the biggest opportunities for banks and telcos lie in the provision of a host of new products - loans, savings accounts, mortgages and insurance - that will become more attractive to people as their wealth increases.
Banks and MNOs still have time to cash in because, with the exception of M-Pesa-dominated Kenya, there are no countries in the region that have seen one dominant player establish itself.
To succeed, would-be contenders need to invest in building up a network of agents and to build up partnerships, says BCG partner Hans Kuipers. "Banks and MNOs are complementary in this space; each has something the other needs. In many cases, it will make sense for them to team up."
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