Emerging economies lead the way in mobile finance

Mobile banking usage surged in the past year as banks offered more services via mobile devices, according to a new report from market research company, TNS.

The largest increases came from emerging markets, where some banks were seen skipping traditional bricks and mortar business models and moving straight into mobile banking.

The report found that China, Kenya and Brazil increased their mobile banking uptake by over 100% between 2010 and 2011, while the USA and the UK also doubled their adoption. New services are provided through both smartphone apps and lower tech SMS, allowing customers to check balances, transfer money and pay bills on move or where other facilities do not exist.

“The necessity, marked interest and the blossoming mobile finance infrastructure means that countries such as Brazil and China have the right ingredients to drive mobile finance growth, not just in their own markets, but globally as well,” said TNS analyst, James Fergusson.

Emerging markets also saw a clear growth in the use of ‘mobile wallet’ technology, allowing money to be loaded onto phone handsets, turning them into ‘virtual debit cards’. Uptake of this technology grew by over 120% in Brazil, China and Kenya.

"Making mobile banking easy to access in these markets will not only help create a more sophisticated consumer marketplace and drive development of the banking sector, but also provides a huge opportunity for the mobile industry," commented Bob Neuhaus, TNS’ head of global finance.

This trend was not reflected in the West, where intrenched purchase mechanisms held back uptake growth.

The report highlights the increased global take up of mobile finance. Fergusson called mobile finance a "logical fit".

"In countries across Sub-Saharan Africa, Latin America and Emerging Asia where there is high mobile phone prevalence, the lack of robust financial services and a need for efficient payment methods has contributed to very strong appeal for mobile finance," he said.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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