Savings as Forward Payments: Innovations on Mobile Money Platforms
Forthcoming as Chapter 10 in "Financial inclusion for poverty alleviation: Banking on the unbanked." Essam Yassin Mohammed and Zenebe Bashaw Uraguchi (eds). London: Routledge.
14 Pages Posted: 29 Apr 2011 Last revised: 23 Dec 2015
Date Written: September 2, 2011
This paper presents a new framework which allows people to manage their diverse payment, cashflow management and commitment savings needs simply and intuitively, from a single account. It builds on the logic of mobile money platforms, which provide customers with the ability to initiate real-time electronic payments from their mobile phone and to keep funds in a store-of-value account. By introducing the notion of forward (or deferred) payments, it is possible to create a much richer set of uses for the basic transactional account which cater to people’s need for commitments and ear-marking of funds for specific goals. It is functionally equivalent to a system where the customer can create multiple sub-accounts, but it is much easier to conceive and manage by the customer since it does not entail multiple account opening or multiple account numbers.
Keywords: Mobile money, mobile banking, electronic payments, branchless banking, access to finance, financial inclusion, financial systems, financial sector development, banking
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