The total number of mobile money users in emerging markets will exceed 1.2 billion in 2025, up from 980 million in 2020; equating to just under 30% of all mobile phone users across emerging markets, according to a new study by Juniper Research.
The report predicts that domestic P2P and payments to merchants will be increasingly popular in mobile money schemes and will drive growth. The research recommends that mobile money providers agree partnerships with banks and other financial institutions, so as to increase the sophistication of the products they offer, in order to take advantage of increasing financial and technological literacy.
Payments-as-a-platform will drive future opportunities
The new research, Mobile Money in Emerging Markets: SWOT Analysis, Vendor Strategies & Market Forecasts 2020-2025, identified that the payments-as-a-platform model, where mobile money payments act as a gateway to third-party services, is critical to the future of the market. Leveraging third-party partnerships and expanding the remit of services will be critical to driving the value of the mobile money market upwards over the next five years.
Research co-author Nick Maynard explains: ‘Mobile money providers’ strong position is under threat, as financial literacy and smartphone penetration grow. Mobile money services must rapidly evolve, or they will lose relevance. The payments-as-a-platform model offers the opportunity for mobile money vendors to become ‘super apps,’ and agreeing partnerships now will be critical in achieving this.’
Sophisticated microfinance users to grow as mobile money broadens
The research found that users of sophisticated microfinance, including microcredit, microsavings and microinsurance, will increase rapidly; reaching over 336 million in 2025, up from 227 million in 2020. As the mobile money market becomes more competitive, additional services beyond simple money transfer have become key differentiators. The report identified that the use of data analytics in mobile money is becoming a key capability; enabling vendors to offer intelligent savings products and to accurately risk manage their credit operations.