Mobile financial services can influence job creation

Latest survey of Boston Consulting Group on social and economic influence of mobile financial services
April 18, 2011 – Introduction of mobile financial services may increase the GDP of Serbia by 2% by 2020, create 23,000 new jobs and reduce corruption, as shown by the latest study titled “Social and Economic Influence of Mobile Financial Services”, conducted by Boston Consulting Group (BCG) on behalf of Telenor.
The survey has covered five countries: Pakistan, Malaysia, Bangladesh, India and Serbia.
Today more than 2.5 billion of adults in the developed world do not have access to basic financial services, such as bank accounts, loans or savings and insurance services. This number is higher in developing countries, often as a result of a lack of credit history of a user, limited access to bank branches and insufficient trust in the existing financial institutions.
Methods of simpler payments and control of money flow can help improve access to education and healthcare for the population with low income, this study shows. At the same time, access to loans and savings services for a broader segment of people can provide a better perspective of employment for the youth in the coming years.
“As a global communications operator, Telenor plays an important role in developing and expanding mobile financial services. With better understanding of ways in which these services influence the economy, the telecoms industry can contribute to the growth of countries where we operate,” says Kjell Morten Johnsen, Telenor CEO.
Business partners, representatives of the government, banking sector, insurance companies an media participated on the event

Development of society 

Opening of new companies, higher entrepreneurship and business expansion, resulting in more jobs, higher bank savings, number of loans and investments, as well as support to entrepreneurs through benefits provided by banks, all contribute to the BDP growth.

Simplified access of the rural population to mobile financial services can ensure higher financial security through reducing costs of financial transactions provided by these services.

Serbia holds the 78th position among 178 countries upon the Corruption Index. Corruption is one of major problems affecting the country. Mobile financial services contribute to the elimination of intermediaries and reduction of cash amounts in transactions, thus reducing corruption.
Financial services in Serbia 

Mobile financial services in Serbia have been offered in the last five years. The country has made progress in offering key financial services, such as bill payments, savings accounts, loans and insurance. However, active use of these services is still underdeveloped due to a lack of trust in banks and providers.
Use of digital certificates and acceptance of digital signature on a SIM card can be an important step forward for the future of mobile financial services and e-government services in Serbia. It is necessary to expand the current success of Serbia in using m-Parking i m-sale of tickets to other micropayment services. Successful use of the mobile payment service stimulates accelerated launch of new products with significant economic and social benefits for the country.
In the next decade, higher use of services such as bill payments, formal savings, loans and insurance can be expected.
Mobile financial services do not represent a substitute for the present banking model. They complement it and more people can get access and participate in banking services. Telecommunications companies have an advantage because they provide mobile financial services to retail clients that traditional banks cannot reach. Mobile operators have previously established relations with users, who are already equipped with a necessary mobile device, and have a large and safe distribution network, unlike traditional financial institutions, which are usually more focused on clients with high income, since they are more cost-effective.
Boston Consulting Group (BCG)

BCG is an international business consulting company with representative offices worldwide. Combining decades of experience in the telecommunications industry and functional expertise, BCG takes one step further than standard solutions, in order to gain insights, motivate organisations, enable accomplishment of measureable results. 
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