Analysis & more​​



  1. PR Summary #3: Worldwide Mobile Money Modernisation & Monetisation 2017-2022
    The Ascent of "Modern" Mobile Money 2017 To 2022.
    The Latest Research conducted by TeleResearch Labs (now part of group ResearchICA) elaborates how mobile money will evolve in forthcoming years through 2017 to 2022. "It’s going to be hard for businesses to succeed in mobile money beyond 2022”. Just as plain and blunt —the full research is a compendium of such & many profound observations & forecasts already taking the industry by storm and setting benchmarks for top executives that go even beyond 2022. "The size of the current market opportunity would squeeze to 60-70% compared to current market-size. Ornamental opportunity will be gone. Players will have to have concrete end to end solutions to keep in pace with the industry." Research provides insights into how operators, banks (including payment banks & challengers), tech giants/ over the top players, & FinTechs will evolve. Their (going to be) place, role, significance in the industry. Research criticises the current move of operators relying too much on "easy business" (read "transaction business”) and going against their core fabric of innovation and technological strengths. And that the Nexus, however critical for survival today will not pay long term dividends and may turn into a huge misadventure in future. Taking bold stance on who’ll make the cut the most, research classifies future into 4 success groups. Group A of grandfather players (big banks & tier-1 operators). Group B of tier-2 operators & small banks. Group C of tech giants, fintechs (r. “clubbers”, tech-enablers, &c.). And Group D comprising mainly facilitators belonging to any one of the three (A,B, or C) Groups procuring subsidies, gov., & special other payments, for mere exposure and purported omnipresence. Not much is expected to happen in the "Low Margin High Volume” Group-A. Both the banks & larger mobile operators will prefer playing safe and continue doing so until their values start clashing, one day. Category B & C will administer most of the innovation and lots of other cool stuff happening. Every player however will evolve & improvise, eventually in quest of modernisation. “Modernity” both at front —&— back ends will alone attract near 85% of the total $1150 billion in revenues expected from across retail, commerce, banking, & payment channels by y2022. Where Group A will get their much required "peripatetic pause” through this research (before getting on to starting anything new), Group B & C will finally have their moonshot at becoming big and indispensable. Group B/C will also be making their 1st billion much faster, 3x the speed of Group A players, according to the research. Currently available on invitation only, research will be made available for general public somewhere in the end of July or early August, 2017.
  2. PR Summary #4: Worldwide Mobile Money Modernisation & Monetisation 2017-2022
    Banks have diluted The Sandbox Model, Operators must find New Potential Ways to stay Innovative & Relevant.
    Yes, you read right. The "Sandbox Model" is not yielding and rather eating time & money including multiple other valuable resources of mobile operators. Fine they are doing partnerships but most of the constructive partnerships, according to the latest research, "Worldwide Mobile Money Modernisation & Monetisation (a.k.a. Modern Mobile Money 2017 to 2022)”, developed by Researchica, in collaboration with its partner TeleResearch Labs, are “namesake”. The best solutions out there on display are solid 'FinTech-Bank combos' with just 1% involving mobile operators. "7 out of 10 startups do not want to work with mobile operators. Startups (will) prefer Banks”, According to a latest survey conducted by ResearchICA. "Among 120 finance technology companies, who are relevant, kicking in their domains, and own a meaningful existence, want —more opportunity, real live experience, strong commitment, trust, & confidence in doing business with whoever they choose ." By definition, Sandbox model is basically a frontier for capturing innovation at the roots; also responsible for the FinTech sector we know that has come into being. So an interesting question that arises here is; How could Operators fail, and Banks (& FinTechs) succeed using the same (Sandbox) model? One, because Banks were not technology pioneers and Sandboxes complement their functioning style. "Stay out, don’t mingle, let us do our work. . . and you do yours, kind of philosophy". And this is also true for FinTechs. Unlike Mobile Operators, Banks give them time, space, ears—most importantly, basically all a 'finance tech enabler' may seek in order to stay relevant & productive. This also works well in keeping check on aspirations of mobile operators. Two, a Challenger type model (a.k.a. “parallel model") will help Banks chaff down 60% of the competition over time, with least direct exposure unto their own. Because money technologies must get mature enough to invite any serious interference from government or the regulators (and that's where it'll all actually begin), supports their this predicament in principle. Operators, according to a report by Harvard review, have this record of doing something new every 2 years; "compelled to innovate”. By 2022, it'll all come down to a lot favouring Banks, especially if operators didn’t soon find new ways of staying relevant. Stamps ResearchICA. "1:10 Sandboxes believe they will fit better with Operators than Banks." 5 years ago, Banks got an epiphany; even a small tweaking, better user experience, polishing here and there could easily jeopardise their hold on hoards of customers. They were at the back foot, technology was never their big prowess. They also needed lot of time to catch up with the (then considered) too advanced level of competition. They wished things would slow-up a bit. They aspired Operators distract and get busy with 5G, IOT, AI, TV, something, anything. Banks did not earlier find it compelling to respond but since the rise of m-Pesa and a few more cases, they’re now alert. And focussed. Increasing their footprint like Chinese, second by second. "If Sandboxes were the only way to go, Mobile Operators will loose." This has complicated things and made operators look small in front of the Banks. Somewhat similar to the "App era”, when App providers directly colluded with the handset makers, ISPs, and left Mobile operators in the lurch. Operators could never get back to that side of the business, as we all know. There are no second thoughts should mobile operators decide to remain stuck with the Sandbox model, they will loose. Forget any long lasting partnerships to come out with the present order of things, ResearchICA finds. This is critical because, "more than 70% mobile operators are expecting to funnel innovation via Sandboxes". Not surprisingly, they are also not getting it and will not get it, if facts are to be believed. So another couple questions that arise here, are—: How can operators become a defacto favourite of Innovators? Should they quit, get more aggressive. . . Or, Can this just be reversed? What other options (other than Sandboxes) do Operators have that can open the gates of the Babylon for them? Operators, however still own something very unique which is 247 connectivity, connection with the consumer. Money and its accessibility are directly proportional to each other, and somewhere down the line, this “connection” is going to play a huge and important role in meeting customer expectations. The (yet to be released) research elaborates on 16-touch points that operators must work upon religiously, if they’re serious about 'mobile money growth'. End note — However the Research uses full circle approach and takes under its ambit, Operators, Banks, Tech Giants/ FinTechs, equally, our money & wishes ride with mobile operators: the industry we serve.
  3. PR Summary #1: Worldwide Mobile Money Modernisation & Monetisation 2017-2022
    90% Mobile Operators Taking Wrong Approach vis-a-vis 'Mobile Money'
    In its latest research “Worldwide Mobile Money Modernisation and Monetisation”, TeleResearch Labs found that modern mobile money operators have achieved average revenue growth of up to 18% by specifically investing in modern mobile money systems and applications. However, 90% of mobile money operators are still working on old models without any significant profit. The Report finds that as mobile money operators turn to ‘Hypergrowth strategy’, operators who are still relying on traditional business models will be outperformed more quickly than can be imagined. And, operators who are designing modern mobile money portfolios will benefit from higher uptake in adoption, sustainable customer loyalty and of course a multitude of revenues. “This first-of- its-kind research report offers critical insights into the transformative impact of modern systems in mobile money industry in developed and emerging markets,” said David Brown, Senior Consultant, BFSI. The Report supports its insights with analyses of hundreds of hypergrowth business models. The Report cites Equitel as an example of one such hypergrowth business that explored mobile money to not only challenge the global leader in the market but successfully outperformed. In less than 2 years of launch, Equitel is now the second largest mobile money service in Kenya as far as mobile money transaction values are concerned. More interestingly, Equitel money has mobile money subscriber share of 4%; however, it accounted for 20% of total mobile money transactions by volume and 22% of total mobile money transactions by value respectively in 2016. The achievement of Equitel is really noteworthy as M-pesa has proven monopoly in Kenyan market in mobile money space. Oscar Mine, Senior Analyst, Mobile Money Business Intelligence, challenges the strategies adopted by majority of operators: How existing mobile money operators afford to allow new entrants hit them so hard? More importantly, how can existing operators become stagnant, keep on offering stale product and anticipate growing revenues, ATPU, etc.? “After studying more than 500 mobile money strategies adopted by operators (MNOs, banks, and FinTechs) in the last decade, we have concluded that Hypergrowth model is required for the modern mobile money businesses that applies across industries and verticals; and, gives the ability to scale quickly, easily, and repeatedly,” said Oscar. TeleResearch Labs’ Thought Provokers: 1.Why the real benefits of mobile money have been elusive for most of the operators? 2.Which are other similar hypergrowth models in development/ implementation phase globally? 3.What is the significance of hypergrowth models for mobile money operators? 4. Who should adopt hypergrowth strategy? The answer to these questions and many noteworthy cases of modern mobile money built upon hypergrowth models with the revenue earning opportunities in both developed and emerging markets have been analysed in the Report – Worldwide Mobile Money Modernisation and Monetisation 2017-2022.
  4. PR Summary #2: Worldwide Mobile Money Modernisation & Monetisation 2017-2022
    ‘Digital Lifestyle Bankers’ to capture 30-50% of retail banking by 2025
    The retail banking landscape will be transformed in a number of ways, from the way service providers used to position their offerings, and its new features and applications, to the type of providers themselves. Digital Lifestyle Bankers, a new breed of players, will flourish; some resulting from collaborations and partnerships among existing players, and some from greenfield players with highly transformative technologies, according to a new report from ResearchICA, Washington DC based Business Research & Consulting Group. The Report predicts that, "Mobile Payments & Banking, Social Banking, Social Lending, P2P Lending, Virtual Marketplaces and others in the areas of mobile money, already present in the market, will only get bigger, smarter, and stronger in the coming years". In fact, evolution of technologies such as blockchain, and the introduction of new regulatory frameworks such as PSD2, will change the rules of the game, increasing the dynamism of the industry and the opportunities for ‘Digital Lifestyle Bankers’. Report finds that, "‘Digital Lifestyle Bankers’ are making big impact on banking industry and forcing a drastic change in the valuechain". The impact is now clearly visible on traditional banking systems. For example, 1,614 bank branches closed in the US in 2016; 600 bank branches closed in the UK in 2016; commercial bank branches declined by 26% in the US during 2005–2015, and 61% since 1994. Similar trend is prevalent across the globe –traditional banking model is stagnating and digital banking is gaining momentum. What is causing such a drastic change in the firmly established banking system? The Report found, "Consumers in a digital world (100% mobile penetration globally) are more empowered than they were a decade ago. The digital consumers no longer rely solely on traditional channels and expect to be always-connected with companies and want to interact with them exactly when they need". And, Banking is no exception to them. Human interaction in banking, payment and commerce will decline by up to 60% worldwide in the next 10 years, mainly impacted by technologies such as robotics, blockchain, artificial intelligence, big data and virtual reality. “In the next 5-10 years, competitive reach in banking and financial space will no longer be determined by physical presence or availability of distribution channel. It will largely depend upon mobile money licenses, selection of right technology for the market and ample marketing budgets,” said David Brown, Senior Consultant, BFSI, ResearchICA. “In the coming years, when every aspect of banking, commerce, payment and retail activity can be done digitally, target market and competitive arena will no longer be defined by physical footprint, but rather by its technology, regulatory boundaries, and the sheer limitations of its marketing budget,” adds Brown. The Report cites digibank as an example of one such hypergrowth business. DBS bank of Singapore launched ‘digital bank account’ branchless banking services in India. The bank allows users to complete the KYC process online to open a normal bank account. DBS offers debit card and a mobile application to its users for doing all types of online transactions. Users can deposit, save, and make payment. The bank also offers 7% interest on the balance in the account more than the average interest of 4% being offered by other banks in India. The above example clearly shows that even "regional banks" could possibly become national players, or even explore overseas markets without any brick-mortar footprint. The situation is ideal for right conglomeration. Mobile money players having right technology can partner with banks or vice versa to compete on a new, larger field. This will help new players to expand into new markets rapidly. However, this digital disruption can potentially breed multiple new competitors and can result in market fragmentation in the short term. The Report predicts that there will be increased competition from non-bank players like PayU and Alipay. Therefore, marketing and branding is going to play a very crucial role and banks can leverage their long history and brand reputation. Diamond Bank of Nigeria realised the situation early and was able to grow its customer base by 50 percent (6 million) in two years, not by opening additional branches but through its "modern (mobile banking) strategy". More interestingly, it took 23 years and 300 branches to Diamond bank to get its first 6 million customers. Mr. A.Bard, Senior Analyst, Mobile Money Business Intelligence, points out, “banks that are still working on old models need to be worried about their future. They must think about the ways by which they can serve the consumers of tomorrow.” As digital technologies offer level playing field to small non-traditional players in the banking industry, banks are forced to invest in modern systems. Failing to do so, banks risk 'disconnect' with even their loyal customers and losing market share to more agile ‘Digital Lifestyle Bankers’. These modern players; FinTechs, digital mobile operators, or conglomerations would be delivering a customer experience that will be more aligned to the expectations of digital consumers of the future. ResearchICA’s Thought Provokers: 1. As technology ensures level playing field for all the players in Retail banking, what are the strategic options Banks can choose from? 2. How ‘Digital Lifestyle Bankers’ are outperforming competition within the industry? 3. What conglomeration of Banks, FinTechs, and Mobile operators can bring on the table? 4. What are the factors that will determine whether MNOs should collaborate or go-solo? 5. What is the best course of action for traditional banking players? 6. What are the upcoming challenges for ‘Digital Lifestyle Bankers’? The answer to these questions and many noteworthy cases of modern mobile money (banking, payment, retail, and commerce) built upon hypergrowth models with the revenue earning opportunities in both developed and emerging markets have been analysed in the Report –"Worldwide Mobile Money Modernisation and Monetisation 2017-2022 (a.k.a. Modern Mobile Money 2022)."

For feedback, comments, write to Editor (a) Researchica (dot) org.