With mobile money having been described as the future of banking, slowly turning the world into cash-less society, consumers have found themselves being bombarded with a variety of options on the market – but which will work best for you?
Auditing firm Ernst and Young (E&Y) recently completed a study on the future benefits of mobile money stating that the nature of money itself is changing. “Mobile money represents greater convenience to end users as payments move away from paper transactions.” E&Y also believe that mobile payment services are expected to reach $245bn in value worldwide by the year 2014.
All four of the country’s major banks have launched mobile money transfer services. Nedbank partnered with Vodacom to launch m-pesa in August 2010, FNB introduced eWallet in 2009, Absa brought its Cash Send service into the market in 2008 and Standard Bank launched lesser known Instant Money in 2010.
All three of these offerings cater for both the banked and unbanked market, by allowing customers to send, receive and in some services store money, without having to have an already existing bank account, or by registering for the service where a bank account is not required.
Instant Money is the only product offering that does not require the cash sender or recipient to have a bank account. Its initial launch saw it isolate its services to participating Spar outlets in the Eastern Cape.
Wizzit also launched a cellphone banking endeavour in 2005, but this can only be used between two bank accountholders, thus defeating the purpose of serving the unbanked community.
Both the eWallet and m-pesa instant money transfer services incorporate e-money/virtual currencies, whilst the others don’t offer a “saving facility” within their package offerings. eWallet is the market leader with more than 500 000 eWallets created and on average R2m being sent daily. m-pesa currently has approximately 140 000 registered users following its launch last year.
Mobile banking has been seen to be booming in Africa, with great prospects expected on the local front. FNB has seen a large uptake in subscribers in neighbouring countries including Swaziland and Botswana, whilst m-pesa performed better in Kenya and Tanzania than in South Africa. Its slow uptake here has led to Vodacom and Nedbank revaluating their strategy.
Responding to pressure from competitors in the market Absa has decided to extend its mobile money facility to small to medium enterprises and agricultural companies, with the launch of CashSend Plus. This will work in the same manner as its normal CashSend service except there will be a 24 hour delay for transactions to be approved. The bank says this is meant as a security measure.
Interesting mobile money was targeted at residents in rural areas but most of the banks have confirmed that a large number of transactions take place in more affluent area, with Gauteng having the highest number of transactions, according to m-pesa and CashSend. Both of these companies have established a large footprint at various universities, where under banked and unbanked students make use of their products. “We are delighted that students have taken up CashSend as an easy solution for receiving money,” said Absa retail bank chief executive Gavin Opperman. As at June, m-pesa had acquired eight outlets at the University of Stellenbosch Campus.
With all the offers available- which would work best for you?
|Product name||Registration||Cost per transaction||Daily Transaction Limits||Cash Transfer points||Cash Receive points||International transfer
|Nedbank and Vodacom
|For sender: Yes for recipient: optional||To registered user: R2.45
To non-registered user: R10
Withdrawal: R6 or R10
|Standard customer: R1000.00
Premium Customer: R5000
|Cell Phone and ATM||m-pesa outlet of Nedbank ATM||No|
|FNB eWallet||Sender must be an FNB account holder||R8||R1000.00||Cell phone, ATM and Online Banking||FNB ATM||No|
|ABSA CashSend||Sender must be an ABSA account holder||Flat Rate: R6.90 plus R1,05 per R100.00 sent||R3000.00||Cell Phone, ATM, Online Banking||ABSA ATN||Yes (through Western Union Bank T&C’s apply )|
|Standard Banks Instant Money||No bank account necessary||R9.95||R5000.00||Online banking and Participating Spar outlets||Participating Spar outlets||No|
So how much would it cost you to transfer R1000 to someone else living in SA?
- m-pesa, will cost R2.45 to a registered user and R10 to a non-registered m-pesa user.
- FNB’s eWallet will cost R8.
- Absa’s CashSend will cost R17.40.
- And Standard Bank amounts to R9.95.
(Transaction costs-exclude actual amount of money transferred ie, R1000)