M-banking
SWISS STYLE (pdf)
10/8/2008 SWISS STYLE - by Jim Phoenix
Modern business can be defined by its speed. Today, major transactions can occur instantaneously over the Internet. This is possible because of services like those provided by WISeKey, an Internet securities company.
Recently, however, WISeKey has taken e-commerce and its idea of immediate abstract transactions a step further, exploring the realm of a Mobile Payment Telco Platform.
Carlos Moreira,WISeKey CEO (at left), with former President Bill Clinton
at the Global Clinton Initiative in New York, September 2008
Mobile banking – the breakthrough
In September, WISeKey announced at the Global Clinton Initiative in New York that it would be participating in a radical new project to help bring banking to previously unbanked people throughout the world. To accomplish this, they had to identify a route to reach these people.
Carlos Moreira, the CEO of WISeKey, asserted, “In the world you have some six billion people and three billion of whom have a mobile phone. Of those three billion with a mobile phone, only one billion have bank accounts.”
By devising a system where banking can take place through phones, this new platform can rest on the basis of an existing infrastructure and reach previously unattainable heights by incorporating the remaining two billion people presently in the world without a bank account. The world’s appetite for mobile phones has exceeded even the most optimistic expectations. Mobile phones could go on to be the most common consumer electronics devices on the planet. And this technology could bring the ability of banking to people who would otherwise have no participation in the global financial system. It could reach regions where physically getting to a bank simply is not practical. “A bank account is a physical notion, where as here the bank account is on your chip. That’s the breakthrough,” says Moreira.
To credit money to another phone’s “wallet”, a person would simply enter their WISeKey ID, the desired transfer amount and the number of where it is going. This amount would then be put on the telephone bill of the sender. In essence, the telcos would be working as small level personal banks for these customers allowing them to increase their ARPU (average per users revenue). The mobile phone would act in place of a credit card, making it possible to buy things with m-payment credit.
The m-banking system is not only for those without bank accounts. Remote transfers can be made phone- to-phone and then moved into a bank account on the other end. Location becomes arbitrary to the equation.
If, however, you are in a more remote area and have no access to a bank, credit on your phone won’t do you much good. So the “wallet” from your mobile phone can be put onto a smart card and retrieved at an ATM, making this a practical solution in developing areas.
WISeKey’s role: Providing the security
Obviously, this is not a project that could plausibly happen through the efforts of one company. The m- banking project consists of several organizations involved with the Clinton Global Initiative. With the cooperation and collaboration of many institutions, they hope to overhaul the banking system and make it more universally accessible.
Other organizations taking part in the project include CGAP, Equity Bank, the GSMA Foundation (with a grant from the Bill and Melinda Gates Foundation), Mpower ventures, Tostan, Western Union, Wizzit Bank and Women’s World Banking. Together, these organizations should be able to form a complete enough network to fund, build and provide these services. “The bottom line is solving the problem,” says Moreira.
The technological requirements for m-banking have existed for quite some time. However, WISeKey’s commitment to security is what it took to turn this technology into a realistic possibility. By providing trustworthy security on the transactions, WISeKey has built the platform on which this project can manifest.
“I am Mediterranean”
The first major undertaking of WISeKey and the Telco Platform project is the “I Am Mediterranean” program. Moreira expressed their goal “to create an ecosystem of Mediterranean countries” by providing citizens of the Antonio Banderas – the “I Am Mediterranean” program’s flagship member region with WISeKey IDs and the possibility of m-payments. They aim to unite the entire region in an Internet community.
It is kicking off with some 300 people linked up, of whom 60 or so are mayors from towns and cities around the Mediterranean. Their desire being that their communities can be compatible with this infrastructure and move into the future of remote commerce. The target is to help around 100 million people from 25 countries in the area. Film star Antonio Banderas is the flagship member, leading the region into this new community.
This should help the region streamline trade and integrate more of their populations into the financial system. “For me it’s a way of doing good at the same time I am building an ecosystem,” says Moreira. In this way, business growth and altruism are one and the same.
This is not the corporate social responsibility of the past but rather a market-demanded social responsibility born out of the linking of people and the inherently egalitarianism of electronic identities – while creating at the same time a new business model on which there is no exclusion. «««
