Easy Stages to Mobile?Andrea Booker |
This past week walking into the local supermarket in my old neighborhood I noticed the check cashing operation inside. There was a line of people, some with cash in hand others with bills to be paid. But I noticed one person walking up to the counter handing the representative some cash and walking away with what looked like a prepaid card. More and more prepaid cards are opening up new financial vehicle options for consumers, specifically the underbanked and unbanked.
Research firm Aite estimates U.S. prepaid will by 2014 grow to US$104 billion (US$164 billion including payroll cards) in volume loaded; a positive opportunity showing some financial vehicles are still growing in light of the economic downturn. Mobile is another such example. Coupling mobile and prepaid looks to be a promising effort to further innovations in payments.
The uptake in developing countries around mobile has shown signs of success. There are parallels in how prepaid has met a need in developed countries and how mobile has met that need in the developing world. Indeed, in countries like Kenya the prepaid and mobile models have been combined in a powerful way enabling players in the market to make significant progress on the mobile front far ahead of most developed countries.
While the U.S. is by most measures a mature payments business, it is still in the nascent stages of mobile payments adoption; similarly with prepaid. Countries like Italy however, also is in the early stages of mobile payments adoption, have modeled what seems to be a promising rollout paradigm similar to that of developing countries like Kenya. Posteitaliane, Italy’s postal service provider and owners of Italys largest bank, BancoPosta, has become a major player in Italy’s mobile market.
Italy is not looking at each of these products in isolation. The PosteMobile brand was created back in 2007 and Posteitaliane has found synergies between the mobile and prepaid space through the Postepay prepaid cards. Customers can send mail, transfer money, pay bills, pay for transportation services, from and to their Postepay prepaid cards through top-up mobile phones. PosteItaliane, with 50 percent of Italy’s mobile share, is finding ways to integrate their customers to a greater familiarity and usage of mobile through the prepaid model.
Could prepaid be the precursor to mobile bringing consumers to a greater handling of mobile payments?