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Posted on March 25, 2013
Mobile Money
The Mobile money industry has shown phenomenal growth and development in the recent years and provides promising opportunities for future .The industries growth can be further maximized if agents and capitalist identify the appropriate business models to achieve scalability and implement business regulations for fair competition. Balancing the needs and expectations of consumers, operators, businesses and regulators is the most sensible and balanced way for development of the mobile money ecosystems.

Increasing competition will be a positive force in the market, but it will also present new regulatory challenges. Two such challenges that are in the scenario are:

  • Competition between banks and MNO
  • Balancing competition and interoperability

Interoperability will reduce domination by some mobile operators and will make the service accessible to thousands at lower prices. Dominant players in Mobile money domain are reluctant to opt for interoperability as it would cut down their profits and pose a threat to competitive advantage. Interoperability increases mobile money’s value to the consumer – and consumers are already beginning to demand it.

Technology leaders are concerned about government interventions which may force them to give up their competitive advantage. Regulatory approach that will balance the interest of customers with those of technology players needs to be evolved at this stage.

A report by Mobile Money for the Unbanked (MMU), suggests some valuable recommendations:
  • Regulators should study the effect implementing interoperability at an early stage of market development in terms of cost and benefits
  • Market should be monitored on a continuous basis to assess the need of further intervention.
  • In the absence of interoperability regulations, monopolies and competition should be assessed periodically.
  • If implemented, regulators should ensure that interoperability remains feasible at low cost to benefit users and provide appropriate incentive to service providers.

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