In A new study by Boston Consulting Group indicates that growth in Mobile Money services industry will bring about fundamental changes in financial and telecom sectors of the economy. By year 2015, Indians could be making transactions worth Rs. 15,75,000, which is equivalent to about $350 billion, with their mobile phones. This monumental avalanche of transactions will include governmental payments, point of sale and bill payments, normal banking transactions, remittances and all kinds of business payments.
However, the forecast that comes out of the study titled The rush of mobile money: madness or master stroke, can only come true if there is willingness on part of banks, telecom operators, regulators, and consumers collectively to embrace this form of payment. Current trends indicate that there is a massive growth in the Mobile Money service industry. Last year there were only 400 users of the Mobile Money service, whereas this year the number of users has already crossed 1.1 crore.
Several banks have indicated their eagerness to enter the field of Mobile Money. There have been numerous tie-ups between banks and telecom companies. SBI has teamed up with Indias largest telecom company by subscribers, Bharti Airtel. ICICI has joined hands with Vodafone; Axis bank with Idea Cellular.
The study by the Boston Consulting Group also indicates that the Mobile Money system might not be a huge generator of revenues for the telecom companies. This is because the transaction charges that get levied on the user will be split between banks, telecom operators, device makers, and other facilitators.
With average revenues per user falling due to high amount of competition in the telecom field, the various players in the industry will welcome any source of extra revenue. The success of the Mobile Money industry in India is also assured by the fact that more than half of households in the country do not have a bank account, but most of them do have access to a mobile phone. Even a basic mobile phone can be used to make transactions.
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