Mobile banking has been the less-understood brother of the more popular online banking. But microfinance policy and research centers, like CGAP, are predicting that as mobile phone usage rapidly increases, so too will mobile banking. Mobile Money refers to a PIN-based mobile payment system that utilizes the mobile device to buy and sell anytime and anywhere. This gives the freedom to shoppers to buy products online and pay the merchant using his/her mobile phone without being physically present at the store. Mobile banking began with simple services, like text message cash transfers, and has rapidly expanded, like paying for a haircut or dinner at a restaurant.
In Africa, only one in five people have a bank account. In these emerging markets, there are one billion people who have cellphones, but no bank account. This is why CGAP is estimating that the mobile financial service market will boom from zero to $5 billion, by 2012.
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