The modern electronic age is characterised by a plethora of new concepts and considerable confusion on the scope and the ambit of buzz-words, terms and descriptions used by bankers, policy makers, private service providers and academics. The lack of coherent definitions and mutually shared categorisations across the industry is one of the factors limiting cooperation, standardisation and contributes to the confusion. At ExactConsult we cut through the confusion and jargon by assisting our clients to understand the highly complex Mobile Financial Services environment. Our in-house experts and associates specialise in mobile banking, mobile money transfer, mobile commerce and mobile acquiring.
Mobile Banking Mobile Banking is commonly misunderstood to be a conglomeration of products overshadowed by the dominance of the mobile channel and erroneously defined by some as a bank on wheels (a bank-teller on the back of a truck that disperses cash in rural areas). At ExactConsult we beg to differ and define Mobile Banking as:
The Exact definition: Mobile Banking or M-Banking is a subset of electronic banking in which customers' access a range of traditional banking products and service via the mobile device irrespective of the mobile device channel be that SMS, USSD, USSD, GPRS or a Smart-phone App. M-banking requires the customer to hold a deposit account to and from which payments or transfers are made. M-banking includes a wider range of financial services, the most important of which is savings and transactions. Mobile banking tends to be Bank or MFI-led, and is normally highly regulated.
With a concentrated focus on client bankability we maintain that Mobile Banking has the potential to replace Bank Branches, ATMs and Call Centres thereby greatly enhancing the value proposition for our clients by lowering the cost of servicing clients and greatly improving scale and hence marginal profitability. ExactConsult specialises in the following:
Mobile Money Transfer Mobile Money Transfer (MMT) is generally considered to consist of cash in - send - cash out and is often erroneously defined so as to include the sending of airtime. At ExactConsult, we define Mobile Money Transfer as:
The Exact definition: Mobile Money Transfer is simply a remittance service where the primary user interface for initiating the transaction is a mobile phone. Customers use their mobile device to send and receive monetary value - or more simply put, to transfer money electronically from person-to person (P2P) using a mobile phone. Banks and registered/licensed Non-Bank Financial Institutions offer domestic and/or international remittances. The technology behind MMT remittances is the easy part. The difficult part of MMT is all about ‘1st mile’ and ‘last mile’ issues, that is getting money-in and money-out, the efficacy of which typically separates the success stories from the failures. Example: M-Pesa
Mobile Commerce Mobile Commerce is often the umbrella definition given to all transactions conducted over the mobile phone and erroneously used to describe Point of Sale (PoS) transactions where the PoS device uses GPRS connectivity. At ExactConsult, we avoid using umbrella terms which are confusing. We define Mobile Commerce as:
The Exact definition: a consumer-to-business (C2B) or a business-to-business (B2B) payment facilitated by the use of the consumer's personal mobile device irrespective of where the store of value or balance is held.
Mobile Acquiring
Mobile payment systems are increasingly being used as a new payment or card acquiring mechanism. Most solutions enable the mobile payment provider to accept payment from customers by allowing them to enter a payment card number into a mobile phone. These systems typically act merely as a replacement of a typical PoS device without the benefit of a card reading device and thus simply capture payment card information as a 'key-entered' transaction. Key focus is given to mitigating the risks associated to key-entered / card-not-present transactions as these types of transactions where banks hold the merchant liable in the event of fraud, can often be more detrimental to merchants than not being paid at all.