The unbanked are both a lucrative and incredibly large market that everyone is attempting to tap into and secure.
While far more common in middle and low-income nations, such as parts of Africa, Asia and Latin America – which boast an incredible 2.7 billion unbanked people, nearly 17 million US citizens are also unbanked.
This is a huge proportion of people missing out on the safety and benefits of saving money into a bank account. Luckily though, there’s a set of spending and saving alternatives available for these consumers to tap into.
Here are just four key companies helping push the Unbanked into becoming the banked.
Who: Arguably the biggest facilitator of the mobile banking world, mFoundry’s 800 strong customer base – which includes “more than one-third of the Top 50 US banks” – is a key way to entice the US unbanked community into banking and spending their money.
How: It does this easily thanks to its clear interface and the unbanked’s penchant for owning smartphones or mobile devices – thus providing them with a clear and easy way to manage their money.
Who: Helping solve the Philippines problem with the unbanked, SMART Money provide a service that encapsulates simple mobile banking, along with a prepaid MasterCard, to capture the huge slice of unbanked potential that the Philippines contains.
How: Because the whole system revolves around the SMART mobile or TNT mobile networks Philippine citizens recognise, payments aren’t aren’t complex in any way – meaning there’s no keywords or transaction codes to memorise and enter in various forms. Users can also simply forward money on to their prepaid MasterCard and use it in a wide variety of stores worldwide and provide remittance while abroad to wire money to relatives easily – all without ever needing to enter or visit a bank.
Who: Formed as a start up company in South Africa in 2002, Wizzit set out to offer a low cost transactional account that worked in both a mobile and physical retail environment for the unbanked in South Africa.
How: Wizzit managed their success in the region by living by it’s business philosophies of enriching the social environment as they expand – such as only hiring the unemployed and training them up to the best they can be.
This ethos, mixed with the self empowerment they offered people with their mobile payments, money transfers and Maestro card, Wizzit has become a key name in the South African mobile payment space. Something they would very much wish to capitalise upon for their future expansion plans into the rest of Africa.
They’ve quickly become the largest mobile payment service in the developing world and by 2012 they had reached 17 million registered users in Kenya.
How: Focused more upon aiding the payment of remittance to family members and friends from anywhere in the world, M-Pesa does away with the physical card side of transactions, instead opting for retailers to display codes for users to make payments to via their mobile.
It’s popularity arose due to the very limited interaction needed with a bank – something that many do not have access to in these regions, or would rather not have to do business with. In the end all parties win as users can make fast and easy payments and transfers, M-Pesa gain a transaction fee per transaction and the banks get business through those saving money up via their mobile.
Do you agree that these four mobile payment companies are some of the key players when it comes to capturing the elusive unbanked market?
Have they succeeded in alleviating the problem, or is it just as prevalent as it always has been?
Could we ever have a completely ‘banked’ society?
Sound off with your thoughts in the comments below.
The future of cards and payments is being discussed at Cards & Payments Africa 2013 and provides an insight into the technology and methods you’ll need to gain access to the lucrative African markets and ensure the unbanked become the banked.