a bank in every pocket

Article in the Economist, Nov. 15, 2007: A bank in Every Pocket (p. 18 in the print edition).

An excerpt:

These “branchless” schemes typically allow customers to deposit and withdraw cash through a mobile operator’s airtime-resale agents, and send money to other people via text messages that can be exchanged for cash by visiting an agent. Workers can then be paid by phone; taxi-drivers and delivery-drivers can accept payments without carrying cash around; money can be easily sent to friends and family. A popular use is to deposit money before making a long journey and then withdraw it at the other end, which is safer than carrying lots of cash.

The article’s background:

The growth in the number of mobile-phone users is nothing short of spectacular. In 1990 there were just over 11m of them worldwide. Today almost 2.5 billion consumers own mobile phones. Some see their spread as the key to bridging the digital divide and boosting development in poor countries. Marketers hail the mobile phone as advertising’s promised land. They are also changing politics, generally for the better.

Competition among telecoms operators and handset-makers is fierce. In Europe, the former racked up huge debts around the turn of the millennium while bidding wildly for third-generation (3G) network licenses. To their disappointment, consumer interest in 3G has been lacklustre. Worse yet, whizzy new services (like mobile TV and wireless broadband) are likely to be carried on other networks in future. Still, the state of play is fluid and speculation remains fevered as to where the phone will go next.