There's a big opportunity for service providers and application developers in emerging markets.
A new report from Berg Insight says that the number of active mobile money users in emerging markets will grow from 61 million last year to 381 million by 2017. That's a compound annual growth rate of 36 percent.
Several of the most successful mobile money services today are in Africa, Berg noted, but Asia-Pacific is expected to become the most important regional market, accounting for nearly two-thirds of the active user base in 2017. The total value of mobile money transactions is projected to grow from $44 billion in 2011 to $395 billion in 2017, a CAGR or 44 percent.
Mobile money plays a key role in extending the reach of formal financial services to the unbanked and financially underserved populations in emerging markets. The mobile phone will also be the primary self-service banking channel for a substantial share of the already banked individuals, Berg said in the report.
“The industry is in a very exciting phase right now. Mobile money has not only taken off in Kenya – we’re seeing exponential growth in Tanzania, Uganda and several other countries as well," said Lars Kurkinen, telecom analyst, Berg Insight.
A number of services targeting the unbanked have been launched in places like Bangladesh, Pakistan, India, Nigeria, Mexico and Argentina. In some countries, mobile money services have already matured to the extent that significant business opportunities emerge for companies from vertical markets, such as insurance providers and merchant acquirers.