Real potential for m-money in Bangladesh identified
Wednesday, 31 March 2010
FE Report
Contrary to the popular notion that says only the big businesses benefit from mobile money, the true potential in Bangladesh lies among the poor, research LIRNEasia, an Asia Pacific think tank on telecom policy and regulation revealed in the city recently.
Dr. Erwin Alampay, who led this research component, said this potential can be largely attributed to the innovations by telecom operators like Grameenphone (GP).
As GP is well known for introducing banking through micro-financing to the poor and have also redefined the mobile usage among poor through the 'phone ladies', this m-money can be an effectively implemented by them, he said.
"By merging the banking and mobile technologies they (GP) are ready to offer mobile payment schemes which Bangladesh poor are certain to benefit from," he added.
According to the conducted survey, only two per cent surveyed individuals claimed to be satisfied with their current mode of sending. At present, bank drafts and wire transfers are still the most preferred means of remittance transactions, since they are the two of the least expensive means.
Given the size of the low income Bangladeshi, and the large number of migrants and the amount and frequency of transactions every month, one can see the great potential of m-money as a value added service for the low income Bangladeshi.
The primary aspect that prevents people from embracing this new mode of transaction has been the awareness and knowledge in using this service.
Like the Philippines, Bangladesh has a large migrant population. In fact, as much as 10 per cent of the low income people in Bangladesh have relatives who are international (external) migrant while another 10 per cent has internal migrant relatives. About 86 per cent of external migrants and 52 per cent of internal Bangladeshi migrants remit back money. On average US$185 is sent at a time, with 59 per cent reporting migrant relatives sending money at least every month or even less.
The research findings also revealed that as many as 43 per cent participants reported having owned a pre-paid mobile phones in their household.
Mobile money is essentially a form of electronic money. Real money is converted into e-money and put into mobile wallets. This mobile currency can then be transferred from one mobile subscriber to another, thereby making funds transfer among individuals, even at a distance, easier.
It is this inter-subscriber transfers which makes m-money's applications for development exciting. In particular, there is great interest in tapping the service for international remittances, which can emerge as one of the most popular and exciting uses of mobile money.
Contrary to the popular notion that says only the big businesses benefit from mobile money, the true potential in Bangladesh lies among the poor, research LIRNEasia, an Asia Pacific think tank on telecom policy and regulation revealed in the city recently.
Dr. Erwin Alampay, who led this research component, said this potential can be largely attributed to the innovations by telecom operators like Grameenphone (GP).
As GP is well known for introducing banking through micro-financing to the poor and have also redefined the mobile usage among poor through the 'phone ladies', this m-money can be an effectively implemented by them, he said.
"By merging the banking and mobile technologies they (GP) are ready to offer mobile payment schemes which Bangladesh poor are certain to benefit from," he added.
According to the conducted survey, only two per cent surveyed individuals claimed to be satisfied with their current mode of sending. At present, bank drafts and wire transfers are still the most preferred means of remittance transactions, since they are the two of the least expensive means.
Given the size of the low income Bangladeshi, and the large number of migrants and the amount and frequency of transactions every month, one can see the great potential of m-money as a value added service for the low income Bangladeshi.
The primary aspect that prevents people from embracing this new mode of transaction has been the awareness and knowledge in using this service.
Like the Philippines, Bangladesh has a large migrant population. In fact, as much as 10 per cent of the low income people in Bangladesh have relatives who are international (external) migrant while another 10 per cent has internal migrant relatives. About 86 per cent of external migrants and 52 per cent of internal Bangladeshi migrants remit back money. On average US$185 is sent at a time, with 59 per cent reporting migrant relatives sending money at least every month or even less.
The research findings also revealed that as many as 43 per cent participants reported having owned a pre-paid mobile phones in their household.
Mobile money is essentially a form of electronic money. Real money is converted into e-money and put into mobile wallets. This mobile currency can then be transferred from one mobile subscriber to another, thereby making funds transfer among individuals, even at a distance, easier.
It is this inter-subscriber transfers which makes m-money's applications for development exciting. In particular, there is great interest in tapping the service for international remittances, which can emerge as one of the most popular and exciting uses of mobile money.