Category Archives: Mobile Payments

The MMPL Story: Innovating through the Assisted Model for e-commerce in India

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Today I am joined by Shashank Joshi, serial entrepreneur and Managing Director of My Mobile Payments Ltd (MMPL), which he set up in 2010. Today MMPL is one of the companies that are driving the war on cash in India. They make it easier for consumers to keep their cash and cards away and just carry their mobile phones.

 

Through an extensive network of 225,000 small stores and a multi-lingual app that supports 10 languages and a proposed first support for payments through WhatsApp, MMPL today provides 24 X 7 mobile payment services to subscribers and merchants under their ‘MoneyOnMobile’ brand.

It was great to hear of the multiple innovations and the insights that Shashank had that led to his innovations that bring the uniquely Indian ‘Assisted Model’ of service to use in serving the needs of the unbanked, while also creating profitable transactions for merchants.

Shashank, thanks very much for your time today. Could we begin by understanding your main motivation for getting into the mobile money business in India?

I’ve been a serial entrepreneur for 22 years, having started my first company before leaving college. From 2003 to 2010 I was heavily involved in payments in the US, managing the whole merchant acquiring process from card swipe to settlement and underwriting. My first plan was to start a POS solution in India. However when I did my feasibility study in 2009 it was the exponential growth of the use of mobile services that set our direction and this led to my embarking on money on mobile in June 2010.

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How did things evolve from SMS based payments to the mobile wallet app you support today?

At first we started with text messaging. As you know, India is a highly price sensitive market and back then we could expect zero Capex when starting our business. We planned for something that needed no change of handset, was not operator led and worked on all networks and I’m glad to say we got some great numbers in our first 3 years.

Today we provide a mobile app and our customers are the small retail stores. Consumers go to these outlets to recharge mobile phones, pay bills and buy tickets and more.

 

Please give us a bit of context on the Indian payments scene (especially the PPI business) and share some of your key learnings in bringing services to market

The Indian payments market is indeed pretty unique. I’ll share three of our key learnings to put some colour on this.

 

Key Learning 1: To succeed in India, Apps must be multi-lingual

India skipped the desktop generation, going direct to mobile. So mobile apps are important, but English only on an app is a deterrent as every state speaks a different language. We modified the app we’d launched last year and now support top 9 regional languages + English. (Ed: Did you know there are 1,683 mother tongue languages in India, with 780 different languages in use today?)

We support Android as that’s a more realistic $65 price point as compared to Apple/ BlackBerry. The unbanked is our primary segment and they have been taking to cheaper smartphones with data plans, to avail of WhatsApp messaging. In fact, MMPL expects to be the first company in India to launch on WhatsApp in the near future. We are also the first to have launched a multilingual app of this kind.

 

Key Learning 2: Ability to convert cash to digital currency is a game-changer

 

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We have focussed on building our key asset in terms of cash network. We already have the ability to convert cash to digital currency at 225,000 “Mom & Pop” outlets in every state across India barring J&K. Going forward we are aiming to increase this to a million by end 2015 (we estimate approximately 4 million small stores exist in India just now).

 

Key Learning 3: Move from COD to CBD

You know how India has developed this unique Cash on Delivery (COD) model. Well the thing is, as many as 8 of 10 cases may be impulse buys – satisfying wants rather than needs. By the time the delivery is on your doorstep in 4 days, quite often that impulse has faded.

 

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E-Commerce cannot be profitably built on a COD model alone: it needs to be a payment first model. At MMPL we are building a Cash Before Delivery (CBD) model. This is a payment method in which an order is processed when received, but is shipped only upon receipt of full payment. Consumers pay from money on mobile wallet to the e-commerce provider, who gets a settlement as he gets from Visa and MasterCard. His payment is now in the bank before the goods are shipped.

 

That is fascinating, thanks Shashank. But I’m still a bit confused about B2B v/s B2C. As you mention that your customers are the stores, could you tell us how this unique model works in India?

In India the B2C model is protected by RBI who must protect consumers. On the other hand the B2B model, where we are talking to the stores is not directly regulated by RBI. In India the B2C model is not seeing so much traction due to the current RBI restrictions on Cash Out. It is rather the B2B model that is growing fast. If you put  ₹ 10,000 on your phone, you can only use it to pay for services, not extract any of it back if you need it.

 

Please tell us a bit about the unique “Assisted Model” of service unique to Indians, and how you innovate to serve the payment needs of the people with this model

People have the tendency to come into the store and ask someone to do the transaction. At first I thought this may be a language issue, but it goes deeper. The self-serve model that is popular in the Western world simply does not work here, is not in the Indian DNA. Look at hotels – there is no such thing as a self-check in hotel here. There is not a card on file concept.

The B2B model really facilitates this assisted model. The outlets are not branded; they are small convenience stores which people visit daily. These retailers have a prepaid arrangement with MMPL – I give them a consolidated balance from which they can then do bill payments, top-up recharge and other functions on behalf of consumers. They hang a small sign outside their shop to let people know the walk-in services they offer, as a footfall driver.

 

Shashank, how do you see regulations evolving in India in the near future?

We are currently involved in a pilot with RBI using Aadhaar card authentication. In another 3 months we should heva the results of the pilot. The pilot has seven participating companies and began two and a half months ago. It’s quite low key for now, on RBI’s stipulation – we can’t do a lot of advertising about it. In fact RBI has been very helpful in evolving these new regulations, and certainly the new government and the highly progressive RBI Governor’s vision greatly helps in evolving services in a way that will help the cashless models of the future.

 

Shashank, it has been fascinating to talk to you and to understand your story. Although I am only just back from our detailed market study for creating our “Digital Money in India 2014”, speaking with you has added more dimensions already, and it just shows how fast the market is evolving and growing. Wish you the very best for the rest of the year, and for your ambitious goals for 2015!

 

POST BLOG UPDATE:

Subsequent to this interview MML won the ‘Best Wallet’ award at The Emerging Payments Awards held in London on October 23, 2014, withstanding stiff competition from major international m-wallet brands such as Starbucks Mobile Wallet UK, EE Cash on Tap and JustYoyo. Congratulations to Ashank Joshi and the MMPL team!

 

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Shashank Joshi is the Managing Director of My Mobile Payments Ltd, a leading mobile payments solutions company based in Mumbai, India, which owns the "Money-on-Mobile" brand. A serial entrepreneur, Shashank has over 22 years of professional experience of leading companies in the areas of IT and ITES, Outsourcing, Transition, Management consulting and Mobile Solutions. He pioneered the successful execution of Merchant Cash Advance and Merchant Processing businesses through the offshore route. Shashank studied Mechanical Engineering from MIT.

 

Charmaine Oak is Practice Lead of Shift Thought

Author of The Digital Money Game, co-author Virtual Currencies – From Secrecy to Safety

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http://www.linkedin.com/in/charmaineoak

Join us to explore ideas at The Digital Money Group on LinkedIn

Write to us at contact@shiftthought.com to share about how YOU are innovating ways for people to pay

How Apple Play affects The Digital Money Game

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Apple has made their play: iPhone 6, iPhone6 Plus, Apple Pay and a wearable Apple Watch. Now that Apple Pay is here, how does this potentially affect retail transactions, e-commerce in general, and the projects in your pipeline.

 

We are at the cusp of the creation of a new ecosystem. But will Apple Pay fare better than Google Wallet did when it first launched in May 2011? There is a feeling of Déjà vu and Let’s Wait and See but also a sense of optimism and expectation of improved retail experience. In the near term iPhone 6 and iPhone6 Plus will be the real winners for Apple revenue, but in the long term Apple Pay will play an increasingly important role in generating revenue from previously untapped sources. As far as the role of Apple Watch itself is concerned, it’s revenue impact in the near term is uncertain but could become more significant as developers bring out apps and its role evolves.

Let us take a look at Apple Pay, as a prerequisite for starting to answer the myriad questions - Is this going to ignite mobile payments? Will it make digital payments more secure? How do the opportunities now stack up? How are the mobile operators likely to react? We all know Verizon, AT&T and T-Mobile were not cheer leaders for the Google Wallet. Softcard (rebranded from ISIS) is readying its own offer. What is PayPal thinking and how does this fit with the Braintree One-Tap announcements? How will Walmart react, and where does this fit with respect to MCX?

 

So why is this important?

The major factor for any new payment service is adoption. Offline retail payments have been sought to be addressed through a variety of methods from PayPal, Google and others, and so far by Apple using iBeacon functionality, BLE and other technologies. So far adoption of NFC has been a 10-year war between the banks and the mobile operators and has struggled to gain traction. It was important for the industry to know Apple’s position with respect to NFC as a standard for mobile payments.

We would all agree that in the current retail and e-commerce arenas one of the most pressing needs is security. The Apple announcement certainly seems to go a long way in addressing this need. For example the combination of its biometric sensors in its devices with the contactless transmission of one-time card number combined with the fact that Apple creates a device-only account number that they store in the secure element, provides a basic foundation for enhanced security. Furthermore as far as customer perspective is concerned, the fact that one can find the phone more easily and take action if it is lost goes a long way towards addressing concerns.

 

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Back in 2011 we had the entry of the Google wallet, and each of the card schemes announced their own wallets as well. Still consumers and merchants failed to adopt. While contactless cards gradually crept into use, paying at retail POS by phone continued to prove elusive, for a variety of reasons. For the longest time, one of the main reasons was claimed to be lack of handsets. However, customer security concerns and more importantly business model were arguably even greater challenges.

And what about adoption?

One of the major challenges in creating a successful service is the ability to bring a large customer base on board rapidly. At the retail level this translates to satisfying consumers both on convenience and trust. In this respect Apple has 800 million customers from their iTune stores as ‘card on file’. However there is a separate step involved to get consumers to start to use Apple Pay for contactless payments as it launches shortly in the US.

This is where the convenience and trust come into play and is something for which we’ll need to wait and watch.

Additionally the Apple API will be available to developers and this is an exciting space to watch. We saw how millions of apps became available for the iPad and iPhone – now Apple Watch is here, and although tethered to the iPhones for the present, it presents a new frontier of innovation. For the present the watch offers an opportunity to integrate a variety of health and fitness related services – something I think we will hear a lot more about shortly.

Merchant support has already been announced: McDonalds, Integration with Uber, a food app from Panera, Major League Baseball's app to order tickets from your phone, and Open Table to pay your bill from your iPhone 6 or iPhone 6 Plus. Apple API is to be offered in iOS 8 to allow app developers to integrate Apple Pay into their applications.

 

So how will mobile operators react?

Apple has a following, and is not overly dependent on mobile operators to push their phones, however operator subsidies that could be as high as $500 considerably help make them affordable. The rapid adoption of smartphones across the world has changed the balance of power. Certainly in the US, Apple is Top Dog as a smartphone manufacturer, with 42.1% OEM market share as of June 2014 according to comScore reports.

Some news is in already as to how mobile operators view this. Softcard (formerly ISIS) have made a statement that they see Apple’s support to NFC as a significant step that sets the stage for rapid scale adoption of mobile commerce.

However while in the US and Europe Samsung and Apple dominate, the share of both providers has been dropping in emerging markets where we see an emerging fragmentation. In urban China, Xiaomi with its affordable RedMi model continues to go from strength to strength, securing a 27% share of smartphone sales in the important China market in the second quarter of 2014, compared with 21.1% for Samsung. And payments by watch + iPhone cannot be a top priority for the masses in emerging markets, although urban, higher income Chinese consumers do seem to be quite interested. 

 

What about the others?

As we describe in great detail in our book, payments has become a hotly contested space. Another fairly late entrant is Amazon.  Just take a look at the Amazon Fire Phone, the first smartphone designed by Amazon. Amazon has vowed to create a whole new shopping experience and until December 31, 2014 the fire phone comes with 800 Amazon Coins to spend on apps, games and more as well as 10% discounted purchase for more Coins. They also offer other benefits including a year of Prime Benefits (Video, Delivery, Books and more).

Such bundles of value are what the customer is increasingly coming to expect, and the whole Apple offer will need to evolve to meet the competition.

 

Too little, too late?

Without doubt, Apple is a late starter where contactless payments are concerned. Like a swan, the movement seemed to be more ‘under-water’, as news of patents obtained for motion based payments got out back in January 2013. For instance, Apple obtained a US Patent for a digital wallet and virtual currency. It described a system of managing credits via a mobile device. Mobile users would be able to receive credits or coupons stored in their accounts. Check out Patently Apple for the background on Apple patents for payments.

Yet, little happened until now.

  • Back in June 2013 Apple released its first mobile commerce platform, called the iCloud Keychain: consumers could store passwords and financial details for use across several Apple devices and they could log into websites or make purchases online. But the platform did not support NFC and existed as an application rather than a physical device.
  • Earlier in June 2012, the Apple bar-code-based Passbook mobile wallet was launched, as a basic mobile wallet without payment functions, using barcodes to store and represent multiple boarding passes, store cards, and movie tickets. It had location-enabled alerts, and real-time updates and it displayed passes based on a specific time or location. When consumers walk into a participating shop the loyalty card appears and can be scanned to pay or check balance. It was expected that this could evolve into a mobile payment service by linking the Passbook to customer credit cards and iTunes accounts.

Effect of Apple Play on the Digital Money Game

The contactless payments that Apple Pay now propose to offer come as a reinforcement to the Digital Money Game of some players, but a threat to others.

And it is no longer enough to offer just mobile payments. To gain adoption, Apple must be able to offer a range of ways to pay, across the web and other channels including TV, now being hotly talked about in emerging markets. And they must get the interoperability story right, and rapidly prove the concept beyond the US market.

 

Read all about this, and work out your own strategy with our recently published, highly acclaimed book, The Digital Money Game. Also, if you would like to discuss immediate ramifications on your projects just drop me a line at coak@shiftthought.com.

 

LIDMGCover

Why I wrote The Digital Money Game

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Thanks for the outpouring of support to me, on the publishing of my first book, The Digital Money Game, now available on Amazon sites around the world. After I last shared about it, A number of you asked me what made me want to write this book, so I’d like to say a bit about this today.

DMGCoverWhen I strayed into the world of payments, after being in Telecoms for many years, it opened my eyes to so many new possibilities. This was around 2005 and it seemed to be a no-brainer for a telecoms operator to build new revenue streams from payments.

This proved elusive though. Firstly it was a personal challenge to try to understand so many new areas all at once, and then be able to position the business case to top management in a way that communicated both opportunities and risks. All of us had spent our lives in Telecoms, IT and non-Payments functions, and we had to rapidly understand Payments, E-Money, Regulations, Prepaid, Cash Networks and all this across multiple geographies.

Regulations did not help. At the time I blamed myself, thinking there was something more I could do. Ten years later, having worked with a world leading bank and the largest money transfer operator in the world, I got to understand regulations so much better. Now I KNOW there was little else I could do: One depends on regulators, who themselves have such a difficult time coping with the large number of changes, with a heavy burden of responsibility on their shoulders.

The truth is, this is all new. We are all learning. But that doesn’t take away the stress of not knowing, as so many of you across the world would agree! I wish I had had someone to tell me what was happening, how it would affect me and what I needed to know to stay ahead. I wanted practical cases I could learn from, and reassurance that this was an exciting space to build a new career.

This is my chance to make that wish a reality for others, by sharing the lessons I learnt and offering some tips from over 10 years I have spent launching services of the different kinds discussed in this book. I hope it will help you in some small way, to reinforce decisions you have to make, to help you to put your case forward to management and most of all to feel good about yourself and what you are achieving in this highly competitive and changing space.

I would love to hear your feedback. Did this book help you? What further questions did it raise?

Click here to go to the Amazon site. To your right you will see a green panel suggesting the most convenient online store for you. Do let me know if you face any difficulty getting access.

The Digital Money Game– a multi-trillion dollar industry emerges

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DMGCover

I have great pleasure in announcing the launch of my new book, The Digital Money Game. I describe the multi-trillion dollar emerging industry I term “Digital Money” from the perspective of very many different industries. It is not just meant for payment experts in large organisations, but for anyone who wants to understand how people pay, and how this is changing in each part of the world.

 

The penetration of mobile phones and smartphones is transforming the way in which consumers interact with brands and greatly facilitates a move towards non-cash payments around the world. To play the game properly though, one needs to understand the changes in a much wider set of fundamentals - identity, security, authentication, regulations, technologies and more, so as to create appropriate vision that goes across channels, services and market segments. That way you have a more effective roadmap with respect to new entrants, and a better chance that what you plan now will still be relevant when your projects go live. I share more about why I wrote The Digital Money Game here.

 

The book is based on Shift Thought research in markets around the world, and my interviews with experts from all the different industries that now participate in payments and financial services. I did my first set of interviews in July 2011. Four years later, the wisdom that they, and countless others shared with me has helped to shape this book. This is the first book in The Digital Money Series and we are currently working on others in the series.

Since then I have learnt so much from so many conversations that unfortunately it is impossible to thank each one of you by name – I hope you will recognize your contributions when you read the book!

 

The book is designed to help you to spot opportunities and gain confidence and insights to channel your work in a way that benefits you, and the markets you serve. It addresses multiple functional areas and levels: Chief Executives, Technologists, Business Development, Market Development and Product Development executives from Banking, Cards, Money Transfer, Telecoms, Payments, Technology, Retail, and Venture Financing Industries.

The digital money approach described in this book can help you create products and services that are secure, convenient and empowering to a whole range of consumers and merchants, across a variety of channels. The goal is to create a shift in thinking – from merely addressing the new opportunity provided by mobile phones, to launching holistic services that build solid brands.

 

My book is available on Amazon stores around the world, priced in local currency and immediately accessible as an  Amazon Kindle download that works across Kindle for PC and a host of commonly used devices. In case it says “Pricing information not available” just look to the right of the screen to select the Amazon site in your country.

In the first 2 days that the book has been available I am delighted to say that it has already been bought from many countries around the world. Thank you so very much for your support and kind words.

 

Have you bought my book? I would love to have your feedback and can direct you to further resources that may be of interest. Do drop me a line at contact@shiftthought.com.

From smartphones to super wallets: how a new breed of applications is changing mobile banking

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This is an interesting time in the development of the digital payments market in Poland. The leading banks are collaborating to launch mobile payment services that potentially bypass the card schemes, allowing consumers to pay directly from their bank accounts. As a follow on from our previous blog, Transforming the way people pay in Poland Charmaine Oak interviewed Tomasz Krajewski, Head of mCommerce at eLeader. SuperWallet claims to be the first wallet to combine mobile banking, mobile payments and mobile commerce services. Tomasz shares his thoughts on the Polish payments market, as well as other markets in which eLeader has been active.

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CO: Tomasz, thanks for taking the time to share with us your thoughts on the development of mobile commerce, in Poland and elsewhere in the world. To start with, could you kindly give us a short introduction on the achievements of eLeader. In which markets do you now operate, and who are your main customers?

TT: eLeader is a leading mobile software company, with experience that dates back to the origins of the smartphone industry. Our services are used in over 70 countries worldwide and clients include Grupo Santander, Unicredit Group, mBank, Danske Bank, Raiffeisen, the National Bank of Kuwait and Orange/T-Mobile.

Our innovations have allowed us to achieve a number of awards and high ranks in industry reports, including a mention in the Top worldwide mobile banking vendors report (Juniper Research, 2012), Technology Fast 50 CE (Deloitte, 2008) and the Top technology companies in Europe (Red Herring, 2013).

 

CO: How has eLeader gained such a leadership position in Mobile Banking?

TT: You can say that going against the current is in eLeader’s DNA. We launched in 2000 with mobile solutions to support employees to work remotely, from outside the office. In those days in Lublin, where we are based, few people had even heard about smartphones, and many felt that this was a crazy idea. And perhaps so it was, but the product was a total success.

We started to invest into mobile banking in 2006 and that was the time when people were speaking about the brilliant future of WAP protocol, forgotten today. Back then, few had heard of smartphones. The iPhone and Android had not yet made a mark. Nokia had a dominant position in the market. At that time, we believed that native apps would be the future of mobility also in the banking industry.

Our first mobile banking platform was revealed in 2007 and it was based on native apps for 3 platforms: Symbian, BlackBerry and Pocket PC. As far as we can tell, ours could well have been a world first solution, with native apps individually designed for all the major OS platforms, accounting for over 95% of the smartphone market.

Raiffeisen Bank became our first customer in Poland. I remember meeting with the President of the bank. Instead of showing a slide deck, our CEO, Dobromir Piekarski, handed him a Nokia smartphone with our banking app – without any instructions. He played with the app in silence and just asked a simple question: How much? After a negotiation of just one minute they shook hands on it. The legend is that this could have been one of the fastest decisions in the banking industry, ever!

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CO: What were some of the challenges you encountered on the way?

TT: The biggest challenge was our first implementation. As mentioned earlier, we started at a time when the mobile banking industry was in its infancy. There was a lack of best practices and useful benchmarks. We had to convince the clients to use our solution, without any projects in the portfolio, armed only with cold calling. Can you imagine what that was like?

We had to design a new concept of application interface, UX and security measures.

Most banks were generally skeptical about native apps at that time; many said that we are going in the wrong direction. Fortunately very soon the iPhone changed the whole industry and attitudes to mobile apps. Native apps went main-stream, and became the norm.

Another milestone was reached when we entered foreign markets. By that time we had something to show in our portfolio, but still needed to prove that an unknown Polish company was able to make great applications and that too without any branches in the client’s country.

 

CO: In what way is Innovation in mobile banking held back by compliance requirements?

TT: Did you know that when the financial crisis came to Poland none of the banks have announced bankruptcy?It seems that none of them have even been in danger of such a situation.

To some extent this is thanks to Polish banking supervision which is very strict in terms of control. However, on the other hand regulations are so far-reaching that they do not allow banks to overstep clearly defined and legally imposed limits. This extends also to the sphere of innovation. You can say that from the regulator point of view, banking is for banks, and deviations from this principle are not allowed.

For instance, take the most used mobile banking functionality – checking one’s bank account balance. Because this is considered disclosure under banking secrecy, bank should require that the user authenticates before gaining access to balance information. Some of banks will ask you to login. Other banks will show you only the percentage of funds left in your account. There is also a bank which lets users choose which of the options would suit them best. You may say this is not a big innovation, but it clearly shows that users want the simplest solutions possible.

Non-bank start-ups are not subject to banking regulations, which is undoubtedly their competitive advantage in the market.

 

CO: In what areas do you see mobile security improving over the next 3 years?

TT: The trend to watch is certainly biometrics. My voice will be my password to mobile banking. Gartner predicts 30% of organizations will use biometric authentication on mobile in 2016 so this is worth watching.

 

CO: What has caused the Polish market to develop more rapidly than some other European markets in recent years?

TT: Polish people don’t use checks, and we never did. When in the 90s Poland entered capitalism after the communist era, emerging banking industry implemented only the newest IT solutions, leap frogging the old payment systems. This is one of the reasons why today we lead in contactless payments globally, and can transfer money from one bank to another in just 30 seconds, thanks to the Elixir Express standard.

Contactless penetration in Poland is higher than anywhere else in Europe or the Americas. This is largely because Visa and MasterCard have invested to subsidize contactless readers, so as to transform Poland into a showcase market for contactless payments. We are at the forefront not just in penetration of cards with a contactless function (20 million, 57.7% of all cards on the market) but also in number of POS accepting contactless payments (in the fourth quarter of 2013 this was already 170 thousand, or 52.1% of all the devices on the market).

Other important favorable factors for Poland include the high mobile and internet penetration, the highly educated society and our continued economic growth. According to Person’s ranking our education is ranked 10th in the world and the last time we had a recession was at the beginning of the XXIII century.

 

CO: How does eLeader expect to continue to play a leadership role in Europe, and elsewhere?

TT: The year 2014 is critical for us, as it is the time for us to launch the new mobile solutions that we have developed through our focused Research & Development over the last few years.

The product we are now introducing to the market is the SuperWallet. It is a combination of m-banking, m-commerce and m-payments. The biggest innovation of these is our embedded in-app commerce services. These services allow users to, for instance purchase public transport tickets, shop for groceries with home delivery, pay for cinema tickets, order taxis and pizzas or book flights.

Our aim is to transform mobile banking into the first choice financial app for smartphone users by supporting them to perform all their daily activities. Recent SAS studies point out that, above all, users perceive mobile wallets as a way to buy goods online, pay bills and check bank accounts. All of these and much more can be achieved by one SuperWallet app.

Together with an ecosystem of integrated merchants, the SuperWallet is offered as a white label solution for banks in a PaaS (Payments as a Service) model.

This has already been successfully deployed by the biggest Santander Group bank in the CEE region, Bank Zachodni WBK, and is gaining popularity among its users. Because the SuperWallet has very flexible architecture and a wide array of capabilities, we are greatly excited to see how it will be used by banks from outside the CEE region.

I believe that the SuperWallet is at the cusp of an emerging market trend. Solutions that are similar but limited to in-app purchases can be found in ICICI Bank and PrivatBank offers.

 

CO: Tomasz, thanks for your time today!

This has been incredibly informative, and provided us with interesting insights into the payments scene in Poland. Above all, what you have achieved at eLeader is most inspiring and I take this opportunity to wish you the best of success with your plans for the SuperWallet and beyond.

Tomasz Krajewski

Tomasz Krajewski is Head of mCommerce/Superwallet at eLeader. He is responsible for development of SuperWallet, which claims to be the first wallet to combine mobile banking, mobile payments and mobile commerce services, thus adding value to mobile banking. The first SuperWallet was deployed in November 2013 in BZ WBK (the biggest bank of Santander Group in CEE). eLeader is one of the world's top mobile innovators in the smartphone business software market, used by global and national companies in over 70 countries worldwide.

 

Digital Money in Retail –3 years on, where are the digital wallets now?–Blog 1

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In mid 2011 we saw the launch/announcements regarding digital wallets from Google, Visa, MasterCard, American Express and many more. Would this mean the end of PayPal’s 10 year domination of this space? 3 years down the line let’s take a look at how these digital wallets fared.

 

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In Mid-2011, led by Google Wallet, digital wallets became the new kid on the block. Shift Thought defines these as customer accounts that can hold stored value and allow users to make electronic commerce transactions.

It was recently reported that Google has no intention of giving up on its slow-growing wallet service or mobile payments, and amusingly it was reported “We have been doing this for a while ..And we’ll continue to keep doing this for a long while.”. By “this” I am sure they do not mean growing the wallet slowly. This piqued my curiosity. Where are the digital wallets now? What are the gains and losses?

In March 2014 Eat24, a restaurant delivery app which integrated with Google end November 2013, reported customers spend an average of 11% more when paying with Google Wallet. Subway was one of the first to accept the Google Wallet, offering the option in 5 markets since 2011. Jack in the Box also started testing Google Wallet in 35 of its restaurants in the Los Angeles and San Francisco markets in November 2011.

Now Google is reportedly changing the way they support contactless payments on the newest versions of Androids. This seems a good time to share our research on how each of the different digital wallets announced in mid-2011 have fared since then.

I’d like to share a bit about the landscape at the time when they launched, as a backdrop for discussing how this has changed, and the main initiatives we see today. In 2011, I created the figure below to explain in one page what the Digital Money ecosystem looked like then.image

There were 7 billion consumers making payments in the world at the time, which included payments between each other (P2P), to and from governments (P2G/G2P) and corporates (P2B/B2P). The figure shows the main industries and players that supported such payments.

In that year banks and money transfer operators were joined by new entrants to create a vastly different competitive market for payments. Alipay and Paypal led the world at the time, but expectations were high for the new Google wallet which offered a business model based on ‘Google Offers’, a targeted sales mechanism that sent promotions to smartphones. This was a scheme by which consumers and merchants benefited, but it raised concerns about personal data.

In the next blog posts I will look in more detail at each of the industries in this figure to see how they have moved on since 2011.

Singapore, a catalyst for lower cash usage in India and Southeast Asia

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We share highlights from our recently published reports on the Indian and Singapore markets. We have planned various events around the Terrapin conference in Singapore from 21-25 April. Join us to help make our very first Road-Show a success.

We believe some of the more interesting bits of our research on Singapore related to the role the country can play in catalysing non-cash payments in South-East Asia, and indeed, within the wider Asia Pacific region. Let me explain why.

As I write this blog, our team is currently chatting with the Aam Admi in India ( the common man, not the political party, though they too have a way of creeping into most conversations now that elections are on).

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As I made my way, still wide-eyed from the experience of our wonderful new Mumbai airport, and the speed with which I was bundled out of customs,  I saw a huge glass building with StarHub emblazoned on it. I fell to wondering what exactly StarHub was doing in India. imageAs their stated aim (quoting from their website today)  “will always be focused on providing every home and every business in Singapore with world-class services”, why such a big presence in India? I learnt that not only is StarHub the No. 2 mobile operator in Singapore, but it also has a variety of other interests (TV, Roaming services and more), in a number of other countries, including India. For that matter, so does the SingTel Group , that includes the No. 1 operator in Singapore, and a great many other Singaporean companies.

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Understanding what Singapore based groups are currently achieving in the 4.2 billion+ Asia-Pacific market is, to my mind, even more important than what they are doing in their home market of 5 million. That is why we do touch on this, in addition to covering the Singapore payments scene. Big changes are underway, from core system changes such as FAST (immediate funds transfer platform), to the very latest interoperable mobile payment services that are trying to tempt Singaporeans to throw away their much used travel cards, and also serve the millions of tourists who annually visit the country.

We are especially eager to share our insights, as the research we carried out this year in Indonesia, India, China, Pakistan, Bangladesh, Nepal, Myanmar and other countries, turned up a wide range of opportunities for providers that are based in Singapore.

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From the 21st to the 25th of April (next week), our team will camp in Singapore for our very first road-show including various events at which we will share highlights of our research. The Asia Pacific (APAC) region has leap-frogged the West in terms of rate of growth of mobile-enabled services. The tech-savvy markets are ready and waiting for services that will help them to achieve their ambitious goals.

Our team in India politely inform me that some of the services I use in the UK may be slightly older versions of what they use here. Yesterday, a 78 year old Indian gentleman proved to have greater affinity and prowess regarding the latest technology for communications than many I’ve met in Europe. Housewives I chatted with categorically and in no uncertain terms, welcome the time-saving new services and I can see massive changes on the cards for India this year - And earlier this year I saw similar signs when we chatted with people in Indonesia.

My quick summary on what I see from our work this week in India, one of the fastest growing markets in the world: To get the services right, providers must understand the Indian context and tailor their service accordingly. ARPU of mobile services is very low, costs are expected to be brought down to match this. People will not pay for what they don’t want – so the package of services must be carefully planned, with easy opt-in, opt-out.

Missed call – A part of the Indian service cycle

One of our interviewees gave us a great example of a company that detected and used a market practice, to exactly appeal to the Indian user. A common practice is for cab drivers to call back to the office when they need to talk, and immediately hang up (missed call). The supervisor is the one with the unlimited talk plan and she will be alerted and call back the cabbie to issue instructions.

This has now become part of many business processes, and is widely known as a missed call. One smart Indian marketing company, Tata Sky TV actually offers their Missed Call Service (MCS) as a way to request their sales team to call back prospective customers or existing subscribers who want to add on a package.

My point is that one can’t expect to bring a service and plant it intact into these growing markets. What is the equivalent of the missed call, that can make the difference between success and failure for your new mobile payment services?

A role for Singapore?

Providers in Singapore are geographically, technologically and culturally well placed to understand and create services to cater to the trends in some of these rapidly growing markets such as India, China, Indonesia, Malaysia and the Philippines. However choice of the market, type of service and customisation of offer for each of these markets becomes all-important. Financial and payment services are at very different maturity levels – expect some of the services you use at home to get “leap-frogged”, and get ready to observe and learn, before planning major projects.

Let’s talk!

If you are part of the great APAC mobile money revolution, come and chat with us so we can learn more about you, what you plan to do and what is holding you back.

We’ll have special promotions on, in case you like what you see and want to pick up some of our reports, subscribe to our premium portal and/or obtain targeted analysis that directly answers your questions. We are keen for you to enjoy what our customers say they liked most – Targeted answers to your most pressing questions, through our unique “Ecosystem Tour - Show and Tell” service ….

So much so that we’ll give you a FREE 15 minute slot to take your question and provide you a response from our continually updated portal  that covers close to 3,500 player profiles, and 1,900 initiatives, 78 different products and services , across 283 markets world-wide. We’d also like to hear your story – what you achieved, what your ambitions are, and how we may be of help.

Just drop me a line at coak@shiftthought.com and we can discuss what event may suit you best. Please be quick though, as we have limited slots and they’re filling fast!