July 8, 2010
As I discuss in my new Pyramid Research Latin American Insider Smartphones and 3G to Create Mobile Banking Opportunity for Network Operators, mobile banking services focused on the middle-to-higher income, technologically savvy users with more advanced handhelds will grow quickly in the coming years in Latin America. These customers will start shifting their desktops for their handhelds. This will not only enable them to access their bank portals from any location, but they will also be able to enjoy other value-added services such as contactless retail payments, money transfers, payments and investments.
The growth of Smartphones will provide the perfect ecosystem for the growth of mobile banking. According to Pyramid Research, 8.6% of all the new units sold in Latin America in 2010 will be smartphones. But we think this number will grow dramatically.
This channel will not only be attractive to mobile subscribers. Operators will be able to offer new value-added services to their clients, reduce churn and increase revenues. Banks, on the other hand, will take the opportunity to increase the services they can offer to their existing clients at a reduced cost.
It is not clear yet which mobile banking business model will prevail. A business model where the banks lead will give them independence but will be limited to servicing those already in the financial system. A hybrid model, where groups of MNOs and banks partner, is the best model to improve the quality of the services provided and the reach of the services.
For more context, see our companion Insider on the state of the global smartphone market today, which discusses ways that operators and vendors can position themselves to meet the growing demand for smartphones, especially in emerging markets. Download a free excerpt or watch a preview. You can also purchase the report here.
— David Noe, Senior Analyst