Africa today - Europe Tomorrow?
Deploying the Last Mile of financial services
Simon Cavill
Mi-Pay Ltd
At the forefront of the hottest trends in payments worldwide• Mobile Initiated Payments & Pre-Paid Top-Up Outsourcing
• Domestic & International airtime and person to person payments
• Meter Initiated Payments (Pre-paid Utilities)
• Micro Payments (e-Wallets issuing & Micro-finance Services)
• Mobile & Internet Payments (Service Provider)
• Media Interactive Payments (Mobile Digital Broadcast & TV)
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Mi-Pay – Mobile Payment Veterans?
• Specialists in secure mobile initiated financial services and payment applications
• 4-year track record of deploying mobile applications worldwide
– 18 countries; 5 languages
• Working with– Banks & Core banking software providers
– Payment services providers
– Mobile operators and MVNO’s
• Implementation partners include– Logica, Unisys, Isys Mobile, Masabi, FE Mobile
• Customers include– Cliq Radio - Live music downloads from UK radio stations
– Misys and Temenos – retail banking software suppliers
– Mobile operators across Europe, The Middle East and Africa
– And several projects in course of completion in Sudan, Kuwait,
Tanzania, Ghana, Senegal etc.
Choices, Choices…
The Rich have a wide range of choices – The Poor do
not…
The Rich have immediate access to a wide range of
payment methods and financial services – The Poor use
cash only and have very limited access to financial services
The Rich trade effortlessly – The Poor would like to if they
had the tools and services to do so
There are more Poor people in the world than Rich ones…
Mother is the necessity of invention – There are many interesting and innovative uses of mobile phones across the developing world largely driven by the lack of any
other infrastructure available to the mass of potential consumers.
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This is Our Market…
That Lady in the blue dress on the top right is our key client – She is a pre-pay top up vendor amongst other things and is the focus of our B2V (Business to Vendor)
strategy. We either get her a special SIM or side-load our Java applet onto her
phone supplied either by the operator or distributor she works for. This application enables her to provide a direct electronic top-up channel to her customer base
removing the need for her to sell coupons or scratch-cards, although it does not
actually stop her doing so. The same device also provides basic stock control and enables her to act as a mobile ATM and/or deliverer of financial services to her
local client base.
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And it’s a Large Market…
2.5 Billion
Lots more!!
???
Potential market of 6.3 Billion people
Do not underestimate the millions of consumers across the World that currently share a single handset between them. Bringing financial services to these shared
users is a real technical challenge!
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Some of whom are short on resources…
are
Our challenge is to delivery a wide range of financial services to people like this…. No access to a bank or any other financial infrastructure in daily life as in the
developing World, most bank branches are confined to cities. The only device
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In the most unusual places…
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Where the phone is often the only contact point for financial services…
There are a whole range of drivers impacting the adoption of mobile initiated payments and financial services to both existing and potential mobile phone
consumers around the world.
So what are the Real Challenges?
Bringing a variety of financial services to potential consumersacross the developing World
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OK, So hereOK, So hereOK, So hereOK, So here’’’’s the Technology Slides the Technology Slides the Technology Slides the Technology Slide
Voice (IVR)
Universal but requires careful design
Voice recognition for secure ID only
Simple and effective
Secure Java Applet
Best client experience
Flexible and brandable
Extremely Secure
Multi-factor authentication
3Des encryption locally and in transmission
No sensitive data on handset
USSD
Universal across all GSM devices
Menu driven - easy to use
More secure than SMS and WAP NFC APPLICATIONS
Tying Ad views to payment opportunities
Small retail payments from SVA’s
Ads / promo / service discovery
Instant free content in retail stores
Transport
SMS
Works on 3 Billion handsets
Used almost universally
Less secure
Encrypted SMS adds security
Simon’s Law – There are only three universal delivery platforms for the mobile handset that can reach every mobile phone consumer – SMS text messaging,
Voice and USSD. Everything else is a risk at it relies on the consumer having a
phone that can initiate an IP connection.
Mi-Pay uses Java applications where they can be deployed to “known” groups of
users such as vendors with suitable handsets.
Consumers interact with Mi-Pay’s mobile initiated financial services through SMS or
USSD typically. An IVR system can be supported where appropriate.
The Last Mile of Financial Services
AgentNetworks
R$
AGENT
MOBILE
R$R$
AGENT
MOBILE
Consumers
Banking the Unbanked
Education Fees
Pre-Pay Funeral Fees
Utility Payments
Bill Payments
Micro-Finance
Micro-Insurance
Airtime as Currency
Pension Distribution
Person to Person Payments
Tax Payments
Pre-Pay Phone Top up’s
International Money Transfers
International Airtime Transfers
Financial Services
Java applet, USSD
USSD, SMS, IVR (Voice)
Mi-Pay
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Mobile Money Transfer
Mi-Pay’s strategy is to work with and through mobile operators and financial service providers across the world to build and maintain mobile initiated money transfer
services that combine the simplicity, cost advantages and reach of the Hawala type
schemes with the strengths of a financially compliant service run through the locally trusted brand of the mobile operator or bank as appropriate.
The system has unique advantages as it enables the operators to hold the inbound remittance flow of money offshore and then offset this value against the locally held
vendor cash balances. We then instruct the vendor to issue cash to the recipient
on the production of a SMS containing a one-time PIN plus their national ID card to the vendor.
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Airtime as Currency
In many places, the operator is the trusted brand and has an enormous reach both politically and geographically. We can use this to potentially create a separate
currency based on airtime that can be transferred between consumers or redeemed
for cash at certain pre-pay vendors who in turn hold the airtime minutes and resell them to other customers.
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Our current road map going forwardOur current road map going forwardOur current road map going forwardOur current road map going forward…………
Household
Small Business
Target Clients
Group microloans
Consumer financeremittances
Educational loans/ finance
Housing loans
Life insurance
Health insurance
Pensions
Micro-investment
Individual microloans
Savings
leasing
Crop insurance
Grants and subsidies
Weather insurance
Agricultural finance
Life insurance
Individual microloans
Groupmicroloans
Product Availability Early planning and experiments
Available today
What’s the relevance of all this to Europe?
Making it all workLarge scale deployments will provide working models
Manage fraud, compliance, & dispute management – Indemnified services?
Airtime/Money TransfersFamily / friends can top up / recharge phones of relatives overseas from their own handsets
Transfer small amounts of money instantly to those with or without bank accounts
Airtime recipients can use received airtime as “currency” forwarding to others on a domestic P2P basis
SEPA – P2P TransfersDirect transfer of small amounts between individual using their handsets
Simple Bill presentment and non retail payments
NFC is still a long way from practical deployment
Practical experience gained elsewhere will be key…
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Visit us on: www.mi-pay.com
Or contact us directly
Thank YouThank YouThank YouThank You…………
Simon Cavill - Mi-Pay Ltd
Tel: + 44 1483 794920Mob: + 44 7733 307123Skype: simoncavEmail: [email protected]
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Mobile Money WorldwideMobile Money WorldwideMobile Money WorldwideMobile Money Worldwide
International / Domestic Airtime and Money Transfer
Currently developing & deploying white label systems for operator groups across four continents
Can receive payment requests from over 100 countries
Fully compliant with all appropriate local & international regulations
Can be provided on an indemnified basis - we take on fraud and other risks
Operator centric approach minimizing use of banks and other money transfer services
Airtime Transfers
Family / friends can top up / recharge phones of relatives overseas from their own handsets
Recipients can use received airtime as “currency” forwarding to others on a domestic P2P basis
Money TransfersUnique approach - Offset inbound hard currency transfers held offshore against pre-pay cash already held in local currency
Low cost approach maximizes revenues whilst enabling consumer to use the service for “free”
Cash transfers paid locally to recipients through operators top up/recharge vendors
Includes bill payment and other financial services through agent network
Mi-Pay is extremely active in this space, currently working with
operator groups in Europe, the Middle East, Africa, Asia and the
America’s to deploy a mixture of airtime and money transfer
systems.
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The FutureThe FutureThe FutureThe Future…………????????
International / Domestic Airtime and Money Transfer Already starting to interconnect “Sending” and “Receiving” operators
National Payment Switches
Airtime TransfersCould airtime be the ” Euro” of the developing world?
Direct linking of people’s pre-pay accounts to others overseas – Auto top-up
Financial ServicesUsing existing or parallel agent networks to roll out financial services nationally
Pension Payments
Healthcare survey’s and Insurance schemes
Savings plans
Huge interest in Micro-Finance from overseas development agencies
There are already interesting discussions around the creation of
exchanges between non competing operator groups to enable the
transfer of airtime and/or money across the World.
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Who we areWho we areWho we areWho we are…………
Established in 2003 on the back of a friendly exit from LogicaCMG
UK HQ and secure data centre near London. Other offices in;
Sibiu, Romania - Merchant support, finance & back office
reconciliation
Dubai UAE - Mid/Near East & Africa sales, secure data centre, local
project management and support
Privately owned. Minority shareholders include:
VocaLink (National UK Payment switch owned by Bank of England,
Barclays and Natwest and other UK clearing banks)
Retail Decisions - Global Fraud screening company
Close Brothers Investment Bank
Founder member of GSMA Mobile Money Transfer Vendors Group
Offer indemnified top-up payment services (UK & Europe)
Web, SMS, Java, WAP, USSD & IVR
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What we doWhat we doWhat we doWhat we do…………
Provide secure, white label services on an outsourced basis to mobile
operators, the finance industry and media owners across the World.
Manage direct pre-pay top up services for mobile operators and other pre-paid
account services - from bank accounts, cards, or cash over the counter
Domestic Peer to Peer mobile money transfer services in two major markets
Mobile e-wallet in several markets for utility bill payment, pre pay top up, loan
funding repayments and other services
International mobile cash remittances in five transmission corridors - UK to
India, UAE to Asia, EU to EU, EU to Africa, and USA to Latin America (2009).
Current clients include Vodafone, Orange, Du (Dubai), Mas Vida (Spain
MVNO), KPN/Telfort (Holland), Carphone Warehouse and Tesco Mobile (UK
MVNOs), Cliq (UK Radio), Luup, 6Telecom, and other major operator groups
Offer indemnified top-up payment services (UK & Europe)
Web, SMS, Java, WAP, USSD & IVR
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