A fresh major report says India is in the process of leapfrogging many nations in mobile-based transactions. There is currently a high level of financial exclusion across India with many households using only cash for savings and spending.
Research and Markets (http://www.researchandmarkets.com/research/td669g/mobile_banking) has announced the addition of the “Mobile Banking and Payments in India to 2017” report to their offering.
The report discusses the key enablers for mobile payments including mobile subscriber numbers, smartphone forecasts, government initiatives, and household penetration rates of mobile bank accounts. Annual estimates and forecasts are provided for years 2012 through 2017. Companies covered include Vodafone, Bharati Airtel, Ezetap, Money on Mobile, Mobikwik, MSwipe and others.
Half of India’s population is still unbanked as of August 2014. One of the reasons for this strong cash tradition across the country is cultural. But beyond culture, another hurdle to financial inclusion is India’s significant financial infrastructure gap which makes banking extremely inconvenient for many, especially those in very rural areas that have no physical bank branches.
Despite significant financial gains during the past five years, India’s current financial infrastructure has not kept pace. The government realizes this dichotomy is a risk to further expansion that could prevent India from reaching its economic potential.
Indian government officials are eager to address this disparity, realizing that the country’s mobile infrastructure and subscriber base has the potential to play an important role, and thus are taking steps to enable mainstream mobile banking and payments. The Reserve Bank of India has mandated that every adult have access to a bank account by 2016. In fact, this goal of 100% financial inclusion is so ambitious; officials realize that it can only be achieved via the use of mobile banking.
The potential surge of mobile-based accounts would be particularly beneficial to the country’s millions of rural migrant workers who need to efficiently transfer funds back to their families. In India, where cash is still king, the author expects the initial bulk of mobile payments to be bank transfers rather than commerce-based transactions.
It is not just the Indian government which is depending on mobile money for development opportunities. Mobile network operators, banks, and device vendors – among others, are increasingly viewing mobile payments as a potential profit center. While the regulatory environment has not favored their direct involvement in mobile banking and payment, the wheels are in motion to support such new market participants and innovative technical mobile banking and payment solutions.
For more data on Mobile Payments access CardData®. For information and commentary on Mobile Payments visit the searchable CardFlash® Library of more than 58,000 articles published since 1995. RAM Research® forecasts on Mobile Payments are available exclusively through CardWeb.com.®