Kathy Gibson at AfricaCom, Cape Town – Mobile money is a complex area, and players must engage the full eco-system of players in order to be successful.

That’s the word from Wizzit’s Brian Richardson, who quips that “if mobile money was easy, everyone would be doing it”.

Having said that, he point out that mobile computing itself has become an integral part of our lives, having moved into just about everything that we do.

“The last thing many people touch at night – and first thing in the morning – is their cell phone,” Richardson points out. “For most of us, it’s never more than a few feet away.”

As such, mobile offers tremendous opportunities in that there are many new users, consumers are increasingly mobile and, compared to traditional ways of doing things, mobile is cheap.

Particularly in Africa, however, cash is still king, still accounting for 80% of retail spending – and it’s growing; last year the cash in circulation grew by 19%. Right now about R12-billion in cash is stashed away in stokvels in South Africa along, he adds.

The main barrier to adopting any alternative to cash, however, is the lack of an acquiring infrastructure – but mobile solves that problem.

Already in the developed world, cash is starting to decline. In the UK, cash payments are expected to fall by one-third while cheque payments around the world are almost non-existent. While card use is rising by 75% mobile payments are also starting to take off.

In the emerging markets, the need is greater, Richardson says, with the cost of an unbanked person coming in at around $40 000 over his lifetime. “However, research shows that most of the unbanked people in the world are not about to open a bank account.”

While mobile payments are gaining traction in Africa, Richardson points out that less than 1% of electronically transacted money is actually used for merchant payments – most often it is swopped for cash, which is then used to buy what’s required. “We seem to have missed an opportunity,” he says.

The problem is that mobile banking is not an easy environment, and there is a complex eco-system that needs to be kept in balance. This spans a range of organisations from technology companies to banks and central banks, from mobile network operators and card associations to retailer and mobile transfer organisation. “We need to get all of these parties to work together.”

Some of the market challenges that mobile banking operators include regulatory – “you ignore the regulator at your peril”, Richardson warns; issues of language, literacy and numeracy; distribution and sales; customer support; marketing; and technology adoption.

“Most importantly, we need partnerships, he says. “Don’t ignore the retailers – they need to support the new payment initiative; the banks need to be involved; as does the agent and the regulator. Most importantly, we need to understand the needs and requirement of the customer. Sometimes banks may mistakenly believe their regular products and services will satisfy new markets, but this may not be so.”

Wizzit is a global player that piloted in South Africa. Although Richardson says it’s tough to be a small player in this market, the service has got 500 000 customers, performing on average 4,38 transactions per month each.

He says the company has learnt some important lessons, among them: you need to have top management buy-in; you need to change behaviour of customers and staff; the staff are not salespeople and need help; and advertising on its own doesn’t work but needs to be part of a full implementation campaign.

However, banks are under huge pressure to bring more of the unbanked population into the fold, with pressure from groups as diverse as G20 and government, and mobile offers them a way to meet their goals, Richardson says.