Mobile Payment Value Chain and Business Models

A high level analysis of Mobile Payment Services.

20 Responses to “Mobile Payment Value Chain and Business Models”

  1. Nice Article Carol!!!

    Regrets for missing this interesting thread as this platform on venturewoods does not allow one to view and track responses on email.

    G-Cash, M-Pesa are success stories and are limited to one territory and mostly because of the local government support in these countries. I was in Western Africa for quite a good time and saw the model completely falling flat as no body wants to take the idea for “security reasons”- the security is insecurity for banks and financial institutions and non-adaptability by the government owned banking institutions and postal departments who contribute to the expansion; majorly in account of technicalities involved in integration and expansion.

    However, India is liberalizing the mobile based payment methodologies and companies like FINO among others are changing the landscape. Micro-payments, mobile payments and remittances needs to be on an integrated platform, which is missing as on date because of regulation and business model focus (or restrictions). Although there are many models in the market trying to change the landscape of indian payment industry

    Anyways, the good news for mobile payment industry in India is:
    - RBI is broadening the base, is willing to incentivize the distribution network (i.e. the people who enable the payments through web or mobile based platforms).
    - The limit is being enhanced regularly
    - The scope within payment industry is being revised on regular intervals- now payments like school fee and regular payouts are being considered for mobile payment modules in the country

    The biggest challenges is viability & return on investments and meeting expansion needs and until some grants (monetary or at policy level) are allocated to the companies operating in this eco-system; there would be only few making it to the semifinals (reach about 30% of the unbanked popluation) or finals (with 50% of the unbanked population)

  2. Anil Lala says:

    We have developed a software wherin thru SMS oferings to Religious organsations and Charitable Institutions can be sent,same is charged in the subscribers bill.We initiated a soft launch in Karnataka and ran successfully for about 3 months. We have signed up agreements with about 15 prominent religious as well as Charitable organisations.Our website shows the exact process how the SMS is sent and how the subscriber gets a reciept on his mobile almost immediately. We have realized that setting up this activity on a National level needs a larger VAS/Mobile company who has the relation with cellular service providers to take it forward as the potential is huge.

  3. Vickram Gopaal says:


    In Japan, NFC technology is used for most mobile payments. This can be through bluetooth or RFID. The only problem is the the handset must be enabled and the merchant must have a compatible POS device. Just swipe, enter pin, enter amount and enter product code. A message goes to the merchant who in turn enters his pin, amount and code and the transaction is complete. This can happen with or without banks being involved.

  4. Hi all,

    I was just going through the views of all of you and are really helpful to understand the industry in all aspects. What we missed here was to summarize what are the key points to conclude:
    - Cash cards which are not associated with the banks are not a part of the debate as there is no guideline from RBI side; however RBI is seriously looking at the revenue loss and the risk of having a parallel payment mechanism; which is against the KYC/banking norms.
    - The mobile payments models which are available today in India do have a level of threat to the business model as Mobile to Mobile or mobile to any other account transfer (except bank/credit card) is not allowed in India. Unfortunately, convenience factor to the end consumer do come first here and all the payment mechanism like mentioned above are only available in our presentations to banks and financial institutions and would take years to educate people (the “aam- aadmi”) and so would the revenue model & business. Till then, all the models riding on this principal are at stake as we really don’t know what shape our business would be taking tomorrow because of the government regulations.

  5. sc says:

    I would be interested in your thoughts on underlying Motivation for Banks in India to provide Mobile Payment services. Especially when the recent RBI regulations puts the complete burdon on Banks.

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