.png)
The portability of wealth and use of cashless transactions has long played a part in cross border transfers of value and exchange networks. Before the emergence of the 17th century goldsmith bankers in London, The Medicis created a network of credit lending spanning across Europe in the 15th century. And Amsterdam’s Wisselbank, or Exchange Bank, was founded in 1609 to value and exchange precious metals. The merchant – and banker - services eventually expanded to include the storage of wealth, transferring money and bills of exchange.
A cashless network of exchange is essential today in emerging markets including Nigeria, where unbanked consumers have turned to alternative mobile payment networks, such as airtime top-ups. The growth towards a financially inclusive landscape was recently noted in a 2019 report from GSMA, with an estimated one billion mobile money accounts globally, processing more than $1.9 billion daily. Nearly half of these accounts are in Sub-Saharan Africa and forecast to exceed half a billion accounts in the first quarter of 2021.
With the emergence of digital passports in the news, mobile wallets may soon be carrying more than digital currencies. Tech giants such as Salesforce and Microsoft are collaborating to create a verification system of vaccine passports, which can be used for identification purposes to store encrypted certificate copies in a digital wallet when travelling. Of course, when we think about carrying anything of value, it is essential that our data and money is secure, and importantly, that as consumers we are in control of that data, particularly where privacy is concerned. For individuals who carry a mobile phone everywhere, whether to check in, to cross borders, or to transact, dipping into a digital wallet to make electronic payments is a part of a seamless integration towards the digitisation of modern life. In 2019 GSMA further reported that digital transactions overtook cash payments with $13.6 billion circulating in the African mobile money ecosystem. In addition, it was highlighted as a sustainable development that there was more mobile money circulating in the African digital infrastructure than being withdrawn. Airtime money transfers had a significant upsurge when cross-borders remittances reached $25billion, up 67% from estimated $15 billion in 2015.
Increased consumer demand coupled with a young demographic will continue to drive alternative payment platforms. The World Economic Forum Annual Meeting of 2020 reported that 77% of Africa’s population is below the age of 35, with an average age of 19 years old. By 2050, two in every five children will be born in Africa, and the impact across the continent is set to triple the urban population. Economic development, physical infrastructure, and resources to tackle inequality and unemployment are key to peace and security and the prevention of young, disaffected population. It is therefore imperative that The Fourth Industrial Revolution brings the majority of the underserved population into the digital financial ecosystem.
The interconnectedness between mobile money financial systems and an economy of services provides countless opportunities to access information and improve quality of life, with innovative credit solutions and entrepreneurship in online markets. Scaling up digital infrastructure with the creation of mobile money accounts will play a vital role in the post Covid-19 recovery. The growth of digital payment platforms is a central part of a dynamic mobile market revolution.
