KINGSTON — Advisor to the Minister of Industry Investment and Commerce, Dr. David Lowe, says that mobile payment services can facilitate commerce, by making business transactions more accessible, efficient and cost effective, especially for small businesses.
Speaking at the Mobile Financial Services Conference on Monday December12, 2011, at the University of the West Indies (UWI) Mona Campus, Dr. Lowe noted that one of the constraints facing businesses is making transactions easier and more convenient for customers.
“This is especially in sectors of the economy where micro payments prevail, as in the case of agriculture and various other micro enterprises, where the existing conventional payment instruments cheques, credit cards make it either too costly, or it is incompatible with the nature of the business,” Dr. Lowe said.
Mobile financial services use wireless handheld devices, such as mobile phones, to pay bills, do money transfers and traditional banking, as well as other transactions.
Dr. Lowe further noted that mobile financial services could also provide job opportunities, and create income generating activities for the country.
“We have seen examples across the world of this development, and the impact it has had on urban and rural communities. But, in particular, I want to highlight the case I have seen in Kenya where M-Pessa, a system that is now supported by almost 12,000 agencies across Kenya, in support of mobile commerce,” he explained.
He stated that the emergence of the agency networks have created hundreds of new jobs, and have become the backbone of successful market segment and development of mobile financial systems.
“More importantly, these agent networks are comprised of small businesses which is where we want to go,” he added.
Executive Director at the Mona School of Business, Professor Ewan Duggan, noted that mobile telephones have produced the “ammunition” with which mobile finances can make a tremendous impact.
“We are focusing on mobile financial services today, largely because of its capability to provide financial inclusion which addresses that second element of the digital divide,” Professor Duggan said.
Developing countries that have implemented a Mobile Financial System have been rewarded with lower costs of accessing financial services, increased transparency and improvements in financial inclusion.
Although the Mobile Financial System is used for a variety of purposes, including savings, its primary purpose and use is to support existing payments and remittances channels. By implication, any country where large numbers of the population cannot access payments and remittances channel through financial account ownership and/or at relatively low costs, will benefit from the Mobile Financial System.
The conference was organised by Solutions for Society, a UWI Think Tank, and the Mona School of Business (MSB), in association with the United States Agency for International Development (USAID), Private Sector Organisation of Jamaica (PSOJ), Development Bank of Jamaica (DBJ) and the Inter-American Development Bank (IDB).
By Latonya Linton, JIS Reporter