Numerous players such as banks and mobile network operators have launched mobile wallet services in virtually every significant global market. But consumer uptake appears to be slow in most cases. A bank-owned vendor in South Africa is claiming that simple SMS-based virtual prepaid vouchers might be better solutions for mobile payments than mobile wallet solutions.
Explosive growth in pre-paid money vouchers in South Africa has killed the mobile wallet as a viable payment instrument says Herman Singh, CEO of Beyond Payments, the payment innovation arm of Standard Bank.
Standard Bank operates its own virtual currency mimoney, which consists of a voucher number delivered to the recipient’s cell phone via SMS. The bank has also teamed up with retailer Spar on a P2P money transfer service, in which SMS vouchers are redeemed at Spar stores throughout the country.
“Lower income segments in this country are asking for less ‘banking bling’ and more utility and value based offerings,” he says. “These solutions must be extremely simple to use and available almost everywhere at extremely low costs. This explains the boom in prepaid money voucher sales.”
Compared with mobile wallets associated with existing bank accounts, virtual prepaid vouchers can be used by almost any consumer rather than any single bank’s existing user groups. But the value and applications offered on top of the simple product will be key to the long-term success of such services.
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