Back in 2002-03 when we were designing the e Sri Lanka initiative, we worried a lot about a ubiquitous mechanism that could enable small online payments. I was hearing more or less the same concerns about the lack of a good payments infrastructure at a digital strategy meeting last week. It appears the India government has solved the problem: WATCHING money drain from your bank account has never been so much fun. On WhatsApp, a messaging service ubiquitous in India, sending rupees is now as easy as posting a selfie. Set-up is a breeze, because all Indian banks have been corralled onto a common payment platform on which anyone, from Google and Samsung to local payment firms and banks themselves, can build their own user interface.
The secret of success is how bad things are. And things are not very good with regard to banking and financial services in the country with the second lowest population density in Asia: In Myanmar cash is king. Fewer than one in ten of its 53m people has a bank account. But an explosion in smartphone use means rudimentary financial offerings are appearing where even roads are rare. After the end of the state’s mobile-phone monopoly four years ago, mobile penetration jumped from 7% to 89% now.
Serious efforts are being made in India to move people away from cash. When I was changing money at Chennai airport for a two-day visit, they foisted a debit card on me. But tourists are a minuscule part of the Indian market. It appears there will be a lot of innovation and competition in that space: The launch of Tez sees Google compete with payment services already available from mobile operators, traditional finance providers, e-Commerce companies and mobile wallet specialist firms including Paytm – which so far has 200 million users. Additionally, chat apps with huge user-bases are at various stages of entering the fray.
Earlier today, I made a presentation at a well-attended lunch-time seminar at the LKY School at the National University of Singapore on the work done by LIRNEasia’s systematic review teams on mobile phone impacts in rural areas, mobile financial services and ICTs in the classroom. Sujata Gamage, the leader of the education SR team, presented the education section. The slides are here. Perhaps the most interesting thing I took away from the discussion was that generally SRs tend to systematically confirm what we already know. At most, like with our SR which showed that the evidence of impacts from mobile-based information services was not solid, it questions established knowledge.