UPU News:- Posts look to mobile technology to unlock financial inclusion potential

Posts are increasingly considering how to offer more efficient financial services using mobile technologies.

Postal representatives, mobile-technology providers and international experts met at UPU headquarters this week to discuss how mobile technologies could boost greater financial inclusion. They examined key challenges and opportunities for postal operators in responding to the rapidly-growing demand for a variety of financial services and meet market expectations.

The number of mobile money services worldwide rose to 241 in July 2014 from 219 in 2013, according to the International Telecommunication Union. With the range of possible business models and technologies available, participants agreed solutions should complement existing services and infrastructure, enabling Posts to create a multi-dimensional hub that brings together mobile, postal points of sale and banking. Presenters stressed that mobile technology alone is not a panacea.

Posts from Burundi, Tunisia, Morocco and Indonesia provided examples of how they had used mobile technologies to successfully scale up their postal financial services, with some partnering with banks and mobile operators to launch new products and services.

In Indonesia, where 245 million inhabitants are scattered on 17,000 islands and banks do not reach 66 per cent of the population, PosIndonesia took the strategic decision to use mobile technologies to grow its financial services and foster greater financial inclusion, said Moehartini Moeharjadi, manager of international relations at PosIndonesia. Financial services account for 45 per cent of the company’s revenues.

“Innovation and development are key to our business,” she added. “Nearly 50 per cent of citizens use mobile phones, while only 29 per cent are connected to the Internet. People are getting more comfortable using mobile phones, so we have developed this technology for our purposes.”

In Morocco, where the Post has transformed its financial services unit into a full-fledged commercial bank, Al Barid Bank has the government’s explicit mandate of advancing financial inclusion. Mobile banking services are available to all citizens, even those who do not have an account with the bank. They are also accessible on all mobile devices, not just smartphones, ensuring wider reach.

For its part, Burundi Post teamed up with mobile operator Econet to supply “Ecocash” money transfer services in over 88 nationwide postal outlets. The Tunisian Post also teamed up with the telecommunications company, Tunisiana, to launch the "Cash Mandates Minute" service through a mobile-payment platform of its own, Mobi-Flouss.

Regulation concerns

Participants agreed that strong legal and regulatory frameworks were important and should be adapted to specific needs and emerging technological innovations. Governments must recognize the postal sector’s importance and help operators reduce costs, mitigate risks and unleash the many benefits of financial inclusion.

Clifford Nkomo, from the Communications Regulators’ Association of Southern Africa (CRASA), said the proliferation of mobile was so rapid that it did not leave enough time for governments to react, allowing mobile payment operators to take advantage of the regulatory void. “We need to establish an authority that would regulate mobile banking services and address affordability, quality and customer protection issues, without overlooking the risks posed by money laundering and terrorist financing,” Nkomo said.

M’hamed El Moussaoui, chairman of the UPU’s Postal Financial Inclusion Project Group and deputy director of Morocco’s Al Barid Bank, recommended a holistic approach to providing financial services. He urged the UPU to continue to find new solutions that go beyond using the Post as a money transfer agent. He said postal operators should be stimulated to provide a variety of financial services and ultimately create their own financial infrastructures.