Mobile operator Claro and Brazilian bank Bradesco have created a joint venture (JV) to promote a prepaid debit card accessed on a mobile device. The announcement follows similar plans from rivals TIM and Oi boosting access to banking services. With greater network coverage than most banks, mobile operators are well placed to extend the reach of services to more remote and rural areas. BMI sees great potential for mobile banking (m-banking) services in Brazil to expand financial services to the unbanked population.
|M-Banking Potential As Market Growth Slows|
|Brazil Mobile Subscriber Forecasts|
Brazil could see the Claro/Bradesco service launched as soon as Q113, while TIM and Oi have still not confirmed dates for their own m-banking service launches. Making the service prepaid - a concept mobile subscribers are very used to - cuts the risks for the bank and allows more subscribers to access the service. The service will consist of a co-branded prepaid debit card administered via a mobile handset allowing subscribers to pay bills, consult credit and other services attached to a savings or current account. There are approximately 43mn Brazilians without access to banking, reports Teletime, providing a huge potential market for Claro, as well as TIM and Oi, to target. While the operator may only receive a small fee for transactions, enticing subscribers onto its network with these kinds of services provides a greater boost to overall income.
Basic m-banking services will be available in the initial rollout in Q113, but the JV will add a new service using near-field communication (NFC) towards the end of that quarter. The NFC service will target high-end subscribers and there are expected to be 300,000 point-of-sale units equipped for NFC by the end of 2012. Encouraging NFC take-up will be more difficult to achieve, as less than 5% of Claro's subscribers have NFC-enabled handsets. While the operator will focus on bringing more enabled devices to the market, BMI believes the NFC m-banking service will grow at a slower rate than the prepaid m-banking debit account.