New Discussion Paper on Smartphones & Mobile Money: The Next Generation of Digital Financial Inclusion

Thursday 10 Jul 2014 |

This blog post is co-written by Mireya Almazán and Elisa Sitbon.

Converging trends offer great promise for the next generation of digital financial inclusion efforts based on smartphones. Devices are getting cheaper, global alliances are advocating for affordable data access, and mobile operators are investing in developing the necessary network capacity and pricing models to manage the inevitable transition from feature phones to smartphones.

Global smartphone adoption is projected to nearly double between 2012 and 2017, with particularly robust growth from emerging markets. In Sub-Saharan Africa, smartphone penetration is expected to grow five-fold over the same period.

This new paper discusses the factors at play and considers the strong potential for increased smartphone penetration to propel the evolution of mobile money. The paper highlights three areas by which the mobile money industry can be impacted:

  1. enhanced user experiences through mobile money apps,
  2. accelerated pace of new product development linked to mobile money accounts, and
  3. a greater degree of competition.

By de-linking the SIM card from the mobile money service, smartphones can lower barriers to entry for a broader range of players to capitalise on the mobile money opportunity, potentially disrupting existing models. At the same time, web-based interfaces and mobile money apps can allow telcos to increase the size of their addressable mobile money market beyond their GSM customer base. Diverse scenarios can emerge in different markets, as we explore in this Discussion Paper.

As more target customers have access to data-enabled smartphones, will telcos risk dis-intermediation, or will they capture a greater slice of an expanding pie? Will over-the-top players become mass-market payments platforms?

These questions will generate much debate over the years to come.

How do you think smartphones will affect the mobile money landscape? We are only scratching the surface of possibilities and invite you to contribute your thoughts at

Download the Discussion Paper.