The number of mobile money transfers is expected to increase by nearly 150% in 2015 to more than 13 billion, with several social media firms already seeing a dramatic rise in service usage, according to a research report from Juniper Research.
With US social payment service Venmo now experiencing traffic worth nearly $1 billion per quarter, leading social media companies were now introducing their own services, the report noted. It also pointed out that Snapchat has partnered with Square to deliver a P2P offering, while Facebook launched a US-wide service last month.
Meanwhile, the report found that in China, both WeChat and Alipay saw astonishing spikes in P2P (Person to Person) traffic during February 2015. This was the result of result of ‘red envelope’ P2P gifting activity when WeChat users engaged in more than 3.3 billion P2P transactions in just six days over the Chinese New Year period.
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In developing markets, the research found that while airtime top up accounted for the largest share of transactions, there had been a significant increase in the deployment and adoption of services such as micro-lending, savings and micro-insurance. It argued that network operators were well positioned to deliver key data for risk assessment in the form of customer top-up histories, social media usage and location data, which could be subjected to analytics to provide information for credit scoring.
Dr Windsor Holden, research author, Juniper Research, said: “The beauty of mobile-based micro-insurance is that, for the first time, the unbanked can be afforded protection against natural disasters. Without it, a farmer suffering crop failure could lose his livelihood.”
Other findings from the report, which is called Mobile Money Transfer & Remittances: Domestic & International Markets 2015-2020, include:
• There are now 17 markets, the majority in sub-Saharan Africa, where the number of mobile wallets exceeds the number of banked individuals.
• Service providers are expected to generate $2bn from mobile money services this year, rising to $4bn by 2018.