The eye-catching success of a handful of mobile money services – M-pesa, obviously – that use airtime as a currency has got the card firms a bit worried. They don’t want to see vast new markets using new types of currency.
This explains why Visa bought Fundamo, one of the firms behind the mobile airtime revolution, in 2011.
But it doesn’t want to alienate the operators, so it’s working with them to launch what it describes as a bank-grade managed service.
The new platform is hosted in Visa managed data centres, and built on Fundamo technology that has been successfully deployed in more than 30 countries.
Unbanked consumers will have access to a financial account that is linked to their mobile number. They can use this to pay cash in and out at agent locations, pay bills, send money to relatives, top-up air time and buy train tickets.
Visa has already done deals with Aircel in India and Bank of Kigali and Urwego Opportunity Bank in Rwanda.
It says it will host and fully manage all aspects of the program on behalf of these providers, from user interface design to consumer enrolment, transactions processing, authorisation, clearing and settlement. The new service can enable domestic-only or globally interoperable mobile money services.
“We applaud the pioneers in Africa, Asia and the Middle East who have launched closed-loop mobile financial services and reached so many consumers so quickly”, said Bill Gajda, Head of Global Mobile Products for Visa Inc.
“As demand grows, so does the cost and complexity to maintain these services. Visa’s new mobile money platform is designed to allow mobile operators and financial institutions to focus on their core business while leaving the management of their mobile money service to Visa.”