Emerging Markets : Opportunities for Mobile Money

“Going Global Means

Going Mobile in Emerging Markets” *

company confidential
 Emerging Markets – Is there opportunity?
1 Reverse innovation of Emerging markets in Mobile apps

 Emerging markets trend in mobile applications

2 Axiata’s M-Money Initiatives in Emerging
markets
 Axiata’s M-Commerce HUB and the
initiatives
 Axiata’s learning's from the market

M-Money’s Success Factors in Emerging

3 markets
 Value Conscious consumers
 Volumes of scales

company confidential
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Mobile Money in Emerging Markets

www.axiata.com

company confidential
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Mobile Money Services Trend in Emerging markets

What possible services can we offer via Mobile Phones?

“There’s an old story about the person who wished his computer
were as easy to use as his telephone. That wish has come true, since
I no longer know how to use my telephone.”
—Attributed to B. Stroustrup, inventor of Objected Oriented
Programming, C++

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Telecommunications Trend
Reverse innovations from Emerging markets

 Vast majority of world economies is classified as

 “Mobile Dominant” vs. “Mobile/Internet balanced”

 Effective Mobile applications are identified first in emerging markets -

then adopted in developed markets.

 What is driving mobile innovations in Emerging markets?

 Predominantly “Low Revenue” generating customers, have forced
operators to look for creative avenues to tap into this customer
base, without compromising profitability.

Sources: 1. White paper by Delta Partners on reverse innovation in telecommunications in emerging markets
2.Studies by Cambridge group on Strategies for emerging markets : Article by Venkatesh Bala Chief Economist
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Value Conscious consumers in emerging markets
BoP requires innovative mobile functions to fulfill their requirements

Contrary to perceptions, the lowest-income consumers in unbanked/unbankable

segments are actually active users of financial services albeit of the non traditional kind

If the likes of
McDonalds can be
successful in
emerging markets,
so can be
“Mobile Money”

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Innovating for emerging markets
Adapt Local Conventions, Accept the differences and Deliver that Precise Need

Low cost + value for money are key drivers for consumers in these markets

Necessity is mother of inventions

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Reverse Innovations From Emerging markets
Some examples …

Year 2000
Year 2006 Year 2008
Innovator: SMART, Philippines
Innovator: TIGO, Tanzania Innovator: MTN, South Africa
Innovation: Micro Payment &
Innovation: Freelance Sales Force Innovation: Dynamic Discounting
Remittance Transfer

SMART Padala & SMART

Money is world’s first … an By deploying mobile sales
answer to low income Dynamic Discount to
force, to bridged the gap
segments’ need to transfer customers for calls during
between reach of distribution
money across domestic & free network load in their
& cost-effective channel
international coverage cells
management

Applications that are not time

Services provided higher Significantly increased critical (eg. music downloads)
ARPU & reduced airtime effective presence of prepaid are good candidates for this
distribution cost recharge in remote locations … reduces network load,
increase quality

Sources: 1. White paper by Delta Partners on reverse innovation in telecommunications in emerging markets
2.Studies by Cambridge group on Strategies for emerging markets : Article by Venkatesh Bala Chief Economist
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Mobile as the only reliable ‘engagement mechanism’
in emerging markets, present opportunities …
• CCBRT Hospital using • M-Pharm (Ghana),
M-PESA for funding voice/text based services
women with Fistula in to price info on retail
Tanzania crops
• M-Midwife - Ghana for M-Health M-Farming • M-Krishi (India), offers
Antenatal, Neo natal Services – Services farming tips by voice/SMS
care for women Bridging the gap Bridging the gap
in rural access to
in access to
medical facilities
information to
farmers

M-Learning M-Payments
Bridging the gap Bridging the gap
• Enable-M (India), a in access to • Robi-Bkash
in access to
company whose business information (Bangladesh),
formal payment
model is around an IVR- Community building
systems
based learning solutions donations payments via
with handset vendors & mobile wallet
Telcos as partners

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Mobile as the only reliable ‘engagement mechanism’
in emerging markets, present opportunities …
• CCBRT Hospital using • M-Pharm (Ghana),
M-PESA for funding voice/text based services
women with Fistula in to price info on retail
Tanzania crops
• M-Midwife - Ghana for M-Health M-Farming • M-Krishi (India), offers
Antenatal, Neo natal Services – Services farming tips by voice/SMS
care for women Bridging the gap Bridging the gap
in rural access to
in access to
medical facilities
information to
farmers

M-Learning M-Payments
Bridging the gap Bridging the gap
• Enable-M (India), a in access to • Robi-Bkash
Lack of other infra-structures in access
presents formal
mobile to
as the only mode of reliable
company whose business information (Bangladesh),
payment
model iscommunication
around an IVR- in these markets; which Community
in turn fosters mobile building
services
systems
based learning solutions donations payments via
with handset vendors & innovations in emerging market mobile wallet
Telcos as partners

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But, what about economics of Mobile services in low
revenue base markets

Is there money in mobile services of “low values” in emerging markets ?

Cost (Revenue generation) Revenue Sources

User Transaction Fee - ~1% of

Platform licenses
txn value
Marketing/Promos – Higher Interest on Float ~ varies from
during 1st 2 years market to market
Agent commission Merchant’s Transaction fee - ~2%
~>60% of txn fee - of txn value

Agent Training & Admin.

Scale is going to be key to success

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Axiata’s Mobile Money initiatives in
Emerging Markets

www.axiata.com

company confidential
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Axiata’s footprint in emerging markets
A landscape offering the right elements for mobile money
Wallet adoption success is in Identifying a “Specific m-Wallet Service”
for individual markets

Axiata’s foot print

in the Region

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Axiata’s m-Commerce services in the region
Examples of Specific m-Wallet services in these markets

Bangladesh
Sri Lanka
Signature service
“ m-Remittance” Axiata’s foot print Signature service
in the Region “m-Payments”
Bridging the gap in
lack of access to Requirement
reliable and faster for P2P – Merchant
money transfer payments, Utility
services “domestic & payments
cross-border”

M-Remittances M-Payments
set the stage for mobile set the stage for
wallet mobile wallet based
“Ebar Hobei” P2P, B2P P2P transfers and
services via partner- remittances
bKash M-Wallet

Exploring the “Unique and Specific” Services in other region

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Axiata’s m-Commerce HUB
Single point of connection to our markets …

UK

Bangla
Malaysia
Desh

Remittances,
Airtime
Indone Middle
sia Forex
Mgmt Settleme
East
nt

Sri Philip
Lanka pines
SEND AIRTIME,

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Axiata’s M-Commerce vision beyond
remittances

www.axiata.com

company confidential
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Axiata m-Commerce HUB – Roadmap
Global Hub for all mobile transactions
M-Cross
Border
Remittan
ces

Axiata
M-
Commerce
Hub
m-Payment Global
Hub, Credit Cross
Cards, Border
Global Airtime
Banks recharge

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Lessons learnt from the emerging markets

www.axiata.com

company confidential
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Learning's from across the Axiata’s markets
Emerging markets user perspective for adopting m-Wallet services

Marketing
Value for
&
Money
Education

Success formula for Emerging Markets is “Value for Money” marketed

with a strong element of trust. Everything else becomes hygiene factors !

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