Latin American mobile payments models different from US
Panelists during the “Latin America M-Commerce Players & Case Studies” session discussed their insight into the opportunities available in various markets and how they should be addressed. The panel was moderated by Seth Schachner, managing director of Strat Americas.
“We look at it from different perspectives,” said Justin Ho, co-CEO/co-founder of Utiba, Singapore. “The needs are very different from the conversations that I hear.
“We work with carriers and banks and the fundamental things [we hear] are, how can I easily pay my electricity bill? How do I get a loan from a bank and how do I enable an easy want to pay that loan using SMS saving me a bus trip to town?” he said. “We’re looking at countries where we have low incomes.
“We’re seeing various models in different countries.”
Other panelists included Alberto Jimenez, mobile payments leader at IBM Global Business Services, Fabricio Bloisi, CEO of Movile, Brazil, Gianluca D’Agostino, CEO of Neomobile, Rome, Gregory Keough, chairman/CEO of RegaloCard, West Palm Beach, FL, Jorge Partidas, CEO of Wau Movil and vice chairman of MEF LATAM and vice chairman of MEF LATAM, Miami and Tom Jahnes, country director at Western Union, Miami.
Bank on mobile
Mr. Ho addressed budget banking where banks can distribute their services starting from the top to the bottom of the pyramid.
“They can’t get to the bottom because the cost model is very high,” Mr Ho said. “We’re seeing a lot of incentives driven around consumers’ needs and the operators are starting to get that.
“The banks are starting to see that there’s a way they can penetrate the market,” he said.
According to Neomobile’s Mr. D’Agostino, there is a lot of proximity in Europe and especially in South Europe with mobile entertainment, content and social networks.
“We see that mobile commerce is a natural evolution in relation with the carriers,” Mr. D’Agostino said. “The trust of the end-user with mobile payments has a lot to do with the trust of the carrier.
“There is no cannibalization really, there is an opportunity to create value than risk,” he said.
IBM’s Mr. Jimenez, said that he does not find mobile payments to be complex in Latin America.
“The ability for companies to drive mobile payments in Latin America is less complex and less different than markets in the U.S.,” Mr. Jimenez said. “If we understand the common factor of consumer adoption in the places it has worked, there would be a massive opportunity in at least mobile payments.”
It is important for companies to have the trust of their consumers, per Wau Movil’s Mr. Partidas.
“For companies to really have a drive, you must first create trust,” Mr. Partidas said. “We’re all here to make money.
“In order to make money, you have to understand taxes, per country,” he said. “You will have huge taxes in Brazil – it’s significant really.”
In addition to trust, Mr. Partidas believes that an important mobile channel for companies to use is SMS.
“Anything done on mobile commerce has to have mobile messaging,” Mr. Partidas said. “The cost of a minute in Latin America is three times the cost than in the U.S.
“In Latin America, all users across different ages text message as a way of communications.”