Western Union views the following as the strongest digital trends in the financial services industry in emerging markets in 2013:
1. Smartphone revolution accelerates in emerging markets…
Cost of entry-level smartphones has decreased, and 3G networks are being built rapidly. In many emerging economies, smartphones are already past the mid-teens penetration rate. Penetration isn’t at that level yet in the very poorest markets, but it’s growing rapidly. Why? Smartphones are revolutionary devices, especially for consumers that don’t have access to computers and the Internet.
2. …leads to growth opportunities in mobile Internet, data use…
Along with extending 3G networks, mobile carriers are introducing the same affordable “by the day” payment plans for data that they’ve long-offered for voice and text. Also, most smartphones can access WiFi at hotspots in coffee shops, work sites, and other locations. These potentially enable developing market consumers to do the same things that developed market consumers are already doing: email, social networking, shopping, mobile money transfer, etc.
3. …and makes digital financial services increasingly accessible to consumers globally.
The STK and USSD-based mobile money services we’ve seen up until now are just the start. The Smartphone app-based model enables delivery of more sophisticated financial applications to consumers. Smartphones also enable “over the top” application provisioning, which opens up the possibility of mobile financial services to a much broader competitive set.