Mobile wallets enabled further financial products

The traction of mobile wallet solutions in a number of countries are now a reality. Millions of people that have not had access to financial services can now experience the benefits of rudimentary payment types. They can now send and receive money, purchase goods and have immediate access to information about their money. But this is not the end of the road. Other financial products that could previously not be delivered now becomes a possibility.

• Savings products are the most likely next application. As a matter of fact, many studies have indicated that subscribers with mobile wallets start using the wallet as a means to keep their money safe. Even though no interest is paid, subscribers are still comfortable in keeping their money in a wallet. This is why the launch of M-kesho recently by Safaricom in Kenya is so interesting (Read here). This is a true savings product living next to the mPesa mobile wallet. As an aside, one would think that the right way forward would be to turn the wallet into a savings account (rather than having a separate savings account.
• Extending the reach of wallets to assist with loan products take many different forms and examples from Kenya to Pakistan and the Philippines abound. The fact that it is now easier to pay out a loan, to collect repayments more smoothly, to assess creditworthiness etc. are all reasons why this sector will grow. (Read here)
• The next wave without any doubt will be when insurance products (and other risk related financial products) are to be delivered by means of mobile wallets. This will be real in a short time-frame and significant benefits will be available to both consumers and suppliers.

The operators of wallet solutions should plan to be ready to launch other financial products as their offerings start to mature.