New forecasts from ABI Research indicate that in 2015 about 244 million people worldwide will carry out financial transactions using their mobile phones. This growth in the financial cell phone sector is not specific to North America or Europe, and large investment is anticipated in regions like Latin America.
Latin American infrastructure is a drawback; only about 33 percent of the population has access to formal financial services. But 80 percent have access to mobile phones, which presents a significant opportunity for extending financial services to millions of low-income customers in the region.
To support this, last month, IFC, a member of the World Bank Group, invested US$3 million for Panama’s YellowPepper plus $2 million to help mobilization for the mobile financial solutions company, in an effort to expand mobile banking and access to financial services in Latin America. YellowPepper has now received $15 million from IFC, which stands as the only equity investment for a mobile banking firm.
“Our goal is to bring the banking system to the masses via the mobile phone,” said Serge Elkiner, President and Founder of YellowPepper. “Because of the enormity of the task, we sought out an investor whose reputation and approach complement our strategy. IFC fits this profile perfectly. It is also one of the largest investors in electronic payments and mobile banking in the world, contributing invaluable insight and experience to innovations happening worldwide.”
Motorola recently conducted a survey where Fifty-one percent of more than 4,530 consumers from the United States, Canada, Spain, Mexico, Argentina and Brazil used their mobile device for shopping. Opinion is clearly divided however. Recent research suggests that there is high demand for mobile banking services among corporate clients, though security concerns may cause adoption to be slow. In spite of this, major retailers and financial institutions such as Best Buy, Amazon, HBSC , Wells Fargo & Co. and Bank of America Corp have joined the mobile revolution. Additionally, the ability to potentially charge fees for such services, something banks have shied away from on the consumer side, is attractive, according to analysts.
To discuss the Latin America’s readiness for this shift, industry leading protagonists will meet in Mexico at the Financial Services Technology Summit (hosted by GDS International) in December. The summit will focus on looking at the current technical ecosystem and debate the changes needed to support the predicated growth.
Among those on hand will be Patricio Melo, COO/CIO of Banco de Chile; Pablo Velazquez Mann, CIO, Banco Columbia; Jose C. Granados, IT Director, Banco Santander Mexico; Luis Felipe Ortiz Rodriguez, COSO Banco Santander Peru; Kelson Corte, CIO, Stuart Pallant, CIO for Americas, Banco de Brasilia and Adolfo Aldama, VP, Head Mexico IB Technology , J.P. Morgan who will use the meeting to explore the use of mobile computing as a catalyst for idea generation in the financial markets and the affinity of mobile computing in the Retail Banking sector, as well as any potential application in Institutional Investment Banking.
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