NextGen Mobile Wallets: The Slim Billfolds May Prove More Lucrative

This MicroSave Briefing Note discusses the increasing importance of mobile wallets (m-wallets). Mobile phones are equally interesting to both ends of the economic spectrum, although there is a sharp divide between what an iPhone with an e-wad of credit cards can do in a shopping mall, and what more basic phones with prepaid cards can offer the less affluent.

The paper examines the different needs of m-wallet users, business cases for different types of m-wallets, varieties of m-wallets and barriers to m-wallet adoption. Conclusions include:

• Wide range of players wish to get into the m-wallet business, because of the revenues and profits involved, although it is complex and problematic;
• M-wallet participants enable government benefits, healthcare and insurance, especially when they are willing to enter developing markets;
• Main barriers to m-wallet adoption include signing up vendors of new technology, splitting the minute income from every transaction, making profits and persuading potential customers to try m-wallets;
• Eliminating elective use of m-wallets solves most of the problems associated with them;
• Seamless cooperation among all players is important for m-wallets to be used as financial inclusion tools.