MANILA, Philippines - Nearly $55 billion in international remittances will be enabled via mobile devices by 2016. For 2011, it is estimated to be under $12 billion.
According to a report from Juniper Research released recently, growth will come from mobile remittances sent across established migration corridors – such as the US-Mexico and intra-regional transfers across Africa and the Middle East – as migrant workers send money home from foreign countries.
Juniper Research is one of the leading analyst firms in the wireless sector. It specializes in identifying and appraising new high growth market sectors within the mobile ecosystem.
Substantial inter/intra-regional activity from and within Western Europe will see that region account for the largest remittance volumes by the end of the forecast period.
The report – Mobile Money Transfer & Remittances: Business Models & Monetization Opportunities – also highlights the opportunity presented in the medium term by the “trickle-down” of smartphone features and functionality into mass market feature phones, such as touch screen interfaces, apps, and Internet access.
“In markets with low literacy levels, money transfer applications on the handset based around easily recognizable icons may gain a far wider usage than services based around text-based menus,” said Windsor Holden, the report’s author.
Service deployments are expected to gain momentum with the increased use of multilateral hubs between MNOs (mobile network operators) and third parties, which connect both sending and receiving channels on a single platform.
That will reduce the time to deployment, as each MNO is required to connect to a hub only once to send/receive remittances and does not have to spend additional time on agreements.
Earlier this year, Juniper Research said that the total value of mobile payments for digital and physical goods, money transfers and NFC (near field communications) transactions will reach $670 billion by 2015, up from an estimated $240 billion in 2011.
The top three regions for mobile payments are the Far East & China, Western Europe and North America. That represents 75 percent of the global mobile payment gross transaction value by 2015. Digital goods payments will account for nearly 40 percent of the market in 2015.
“These forecasts represent the gross merchandise value of all purchases or the value of money being transferred,” the report said.
All segments will exhibit double to triple growth over the next five years. This growth will be driven by the rapid adoption of mobile ticketing, NFC contactless payments, physical goods purchases and money transfers as people in both developed and developing countries use their devices for everyday transactions.
Some 20 countries are expected to launch NFC services in the next 18 months, resulting in transactions approaching $50 billion worldwide by 2014.
Meanwhile the need for financial access in developing countries is such that active mobile money users will double by 2013 and drive transaction values accordingly.
“Our analysis shows that emerging segments such as physical goods payments, NFC and money transfers will fuel market growth by a factor of 2.7 times by 2015. Digital goods is the largest segment and, although forecast to more than double, it is not growing as quickly as some of the newer segments,” David Snow, Juniper senior analyst, said in the report.