With dozens of mobile money services launched in the last few years in Africa, Asia and Latin America, many industry participants are now looking to answer a simple question: is mobile money a profitable business? The answer to this question matters to a broad spectrum of participants, from C-level executives tasked with allocating budgets, to front line practitioners from mobile operators who are responsible for managing a profit/loss centre.
In this section we highlight articles, blog posts and other resources that operators might find useful when researching this topic.
1. Is Mobile Money a Profitable Business?
Is There Really any Money in Mobile Money?
Author : Paul Leishman, GSMATo answer the question of ‘Is there really any money in mobile money?’, this article draws on analysis of 16 months of financials from Uganda’s MTN MobileMoney, a growing service in East Africa. Key insights on mobile money profitability are presented, including the significance of direct and indirect benefits, the cost and investment drivers for a scaling service, and more.
The Economics of Branchless Banking
Author : Ignacio Mas, The Bill and Melinda Gates FoundationIn this article, the author presents a vision for how to construct a banking infrastructure that is commercially viable, safe and trusted, and accessible to all. It also provides an overview of the incentives driving each participant in the value chain, and details the importance of driving volume through the system.
2. Other resources
GSMA Webinar on Mobile Money Pricing and Commissions
Author : Paul Leishman and Camilo Tellez, GSMAThese videos are designed to provide mobile operators with a clear understanding of the process that’s used to develop mobile money prices and commissions.
It covers a mix of theory and real world examples, and simulates the development process for an imaginary service. (Available in Spanish)
- Commissions
Generic Mobile Money Financial Model
Author : GSMAThis financial model was developed by GSMA in 2010 to help mobile operators gauge the profitability of their p2p transfer and airtime top-up mobile money services. It is available for free download and may serve as a helpful resource for practitioners developing their own models.
A Financial Analysis of Mobile Money Service Models
Author : Peter Lyons, Oscar Gruss & SonsRecorded at mobile money Summit 2010 in Rio. Peter Lyons highlights profitability issues like ROI for the MNO, and the impact that distribution networks can have on a working capital cycle.
CGAP Agent Network Financial Model
Author : CGAPCGAP’s agent Management toolkit includes an excel-based financial model to help providers project the revenues generated in a branchless banking service and how these are shared between members of the supply chain.
