HomeInsightsTelenor hails stickiness of mobile money services

    Telenor hails stickiness of mobile money services


    Mobile financial services to reduce churn and raise ARPUs

    Speaking in the Financial Services Keynote at Mobile World Congress today, Telenor’s Kristin Skogen Lund, EVP and head of digital services and Nordic, Telenor, said that mobile banking and payments in the developing world should be of particular interest to mobile operators.

    Skogen Lund stated: “We believe there is a great future in mobile banking for mobile operators. It is one of the biggest opportunities we have as mobile operators, especially in emerging markets, because of things like speed, simplicity and cost.

    “As a mobile operator, these services make your churn go down and your average revenue per user go up; the stickiness of these services is essential,” she enthused.

    Skogen Lund pointed to Telenor’s EasyPaisa service in Pakistan, run in conjunction with Tameer Microfinance , which brings mobile banking and transactions to the unbanked in that country. “This service is growing incredibly fast,” she stated. “We are seeing double digit growth month on month, and last year we passed 30 million transactions.”

    She added: “We feel very few banks are in a position to make this kind of service, and we feel that mobile operators are in a brilliant position to take advantage of this.”

    Research carried out by Boston Consulting Group on behalf of Telenor last year estimated that in the developing world, more than 2.5 billion adults, approximately 72% of the population, are unbanked, meaning they have no access to traditional financial services like banks.

    At the same time, nearly 2.5 billion people in these same emerging economies have mobile phones. This means that there could be up to two billion mobile phone users who are currently unbanked that could be served through mobile financial services, Skogen Lund remarked.

    Overall in the five countries covered in the study, including Pakistan and Bangladesh, mobile financial services has the potential to reduce financial exclusion by 5% to 20% through to 2020, and increase GDP by up to 5%, Skogen Lund stated.