Last week, the GSMA Mobile Money for the Unbanked programme (MMU) released its 2013 report on the State of Mobile Financial Services. This month, we are going to present the main conclusions and insights from this report in a series of blog posts. Today, we want to explore the state of mobile money [1] usage. In this blog post, we will try to answer the following question: How many people use mobile money globally?
How many mobile money accounts are there?
Today, the majority of mobile money services rely on a mobile wallet that allows customers to store value in an account that can be accessed through their mobile phone. Once they have value in their mobile wallet (because, e.g., they have converted cash into electronic value or the value has been transferred to them from another account), customers can initiate payments and transfers directly through their mobile phone without needing to go to a mobile money agent. Therefore, to understand how many people are using mobile money, it is useful to look at the total number of registered mobile money accounts.
In June 2013, there were over 203m registered mobile money accounts worldwide, compared to just 108m in June 2012.
How many of these accounts are active?
Of the 203m registered accounts in June 2013, 61m had been used to perform at least one transaction within the last 90 days and 37m within the last 30 days. It is encouraging to see that an increasing number of services are ‘reaching scale’, defined as having over 1 million active users on a 90-day basis. 13 services have already reached scale, seven of which passed the 1 million active user threshold between June 2012 and June 2013.
However, activating customers remains a challenge for a large number of services. Globally, only 29.9% of registered accounts were active in June 2013. Indeed, the customer’s journey from awareness of mobile money, to registration, and finally to regular usage, is quite complex. Even when customers are aware of the service, they may not necessarily understand how they would benefit from using it. Using mobile money represents a significant behavioural change in economies where almost all payment transactions are conducted in cash.
The map below shows the breakdown of mobile money registered and active accounts by region.
One thing that strikes me when I look at this map is how many mobile money users are in Sub-Saharan Africa. In Sub-Saharan Africa only, there were 98 million registered accounts in June 2013; this is more than twice as many as the total number of Facebook users in the region. More specifically, East Africa accounts for a particularly large portion of mobile money accounts globally, representing 34% of total registered accounts.
The second largest region in terms of active mobile money accounts is South Asia. However, the actual number of mobile money users in this region is much higher: in addition to the 10.5m active accounts represented on the map, another 15m unregistered users had performed mobile money transactions over-the-counter in June 2013.
What about unregistered mobile money users who transact over-the-counter?
Indeed, not all mobile money services rely on a mobile wallet. Some services are being offered primarily “over-the-counter” (we call them OTC services). In such cases, a mobile money agent performs the transactions on behalf of the customer, who does not need to register to use the mobile money service. 13.4% of respondents to our survey offered services delivered primarily over-the-counter [2]. Typically, providers verify and record the identity of OTC customers to comply with customer due diligence (CDD) requirements, nevertheless it is challenging to calculate the number of individual users of OTC services, particularly when the transactions are recorded manually. However, based on the stored KYC information most respondents were able to estimate the number of unique unregistered mobile money users they have on a monthly basis.
In June 2013, survey respondents reported 17.3 million unregistered mobile money users and four services had more than 1 million unregistered users. The number of unregistered mobile money users seems to be growing even faster than the number of active wallets at an annualized growth rate of 102%. Services offered primarily over-the-counter offer a compelling value proposition for unbanked customers, a segment where literacy levels are often very low and where people tend to be more suspicious of new technologies. The OTC model is particularly popular in South Asia, home to 87.6% of the world’s unregistered users. However, in terms of financial inclusion, the full potential of mobile money cannot be realised with the OTC model. Mobile wallets remain a key tool in building the financial capability of the underserved.
Conclusion
So how many people use mobile money globally? We know that 37m mobile money accounts have been used to perform at least on transaction in June. In addition, 17m unregistered users have performed mobile money transactions over the counter during that month. In conclusion, we can say that during the month of June 2013, 54m people performed mobile money transactions.
[1] MMU 2013 State of the Industry Report focuses on mobile money services that meet the following criteria:
- The service must offer at least one of the following services: P2P transfer, bill payment, bulk payment, merchant payment, and international remittance.
- The service must rely heavily on a network of transactional points outside bank branches that make the service accessible to unbanked and underbanked people. Customers must be able to use the service without having been previously banked. Services that offer the mobile phone as just another channel to access a traditional banking product are not included.
- The service must offer an interface for initiating transactions for agents and/or customers that is available on basic mobile devices.
[2] Services which had more unregistered users transacting in June 2013 than active wallets during this month were considered as services delivered primarily over-the-counter.