Mobile Money: Growth Potential, Current Landscape, and Factors for Success
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e-money, anti-money laundering/combating the financing of terrorism (AML/CFT), or other relevant legislation, as mentioned earlier. In the future, it will be interesting to see whether emerging providers will find that m-money by itself serves as a profitable business proposition in the jurisdictions where they operate, or whether m-money can be profitable only as part of a larger bundle of service offerings provided by all entities (banks, MNOs, and third parties) involved in the m-money transaction. In this regard, the case of third-party providers will be especially interesting because these providers (unlike banks or telecoms) are exclusively in the business of m-money and thus do not have an incentive to deploy m-money programs as simply a mechanism to reduce customer turnover. It is not yet clear if third-party providers generally will find m-money to be a profitable endeavor by itself. It is likely this would diverge greatly on the basis of jurisdiction-specific conditions.
The Current Global Regulatory Scenario The extent of involvement among the different entities in an m-money transaction often depends on existing regulations in the jurisdiction. In India, as well as most other surveyed jurisdictions where m-money has been deployed, banks are required to play a larger role than the MNO or third-party providers in the various stages of an m-money transaction. This means that banks frequently offer their own customers some type of mobile banking service (such as one that lets a customer view his or her bank account information on a mobile device) and perhaps a transactionenabling service (such as m-money). However, there are signs that this soon may change in India and other jurisdictions where MNOs are being allowed to play a larger role in an m-money transaction. This wider empowerment often has been the result of national authorities becoming more aware of the intricacies of an m-money transaction and learning how other jurisdictions may be regulating and supervising m-money entities outside of banks to mitigate the integrity, prudential, and other risks associated with the use of such channels. In certain jurisdictions, not all the relevant regulations that could govern m-money are formally enacted—for example, relevant AML/CFT laws or e-money or payment system laws.11 In Zambia, for example, there is a national payment system law and an AML/CFT law, but no law governing e-money. In Kenya, an AML law was passed in January 2010, but other relevant regulations have not been formally enacted. Nonetheless, m-money programs are active in these jurisdictions; and some national