Andres García – Commercial Director

Vippo.

Every time I go abroad and attend seminars and events related to the mobile payments industry the same question comes to my mind: Why is so hard implementing mobile payments in Latam?

This question is constantly surrounding me since 2011 when I had my first opportunity of participating in this kind of events.

The answer I like most surged after several months of fieldwork in Venezuela. My team and I realized that if any company or financial institution wants to implement mobile wallets and develop mobile payments ecosystem, it has to go deep into the social fabric and examine how companies monetize their value proposals in the different environments a same society contains.

Since the term «Mobile Payments» emerged we have heard about the ability of mobile phones of becoming a wallet. Some people are still waiting for figures about the penetration of smartphones because in their opinion it is only achievable through mobile apps. They don’t trust SMS for security reasons. Maybe they don’t like an IVR system as a authenticator of transactions. There’s also USSD, but it’s not open in all the countries.

But accordingly to my experience the implementation of mobile payments ecosystems is not about technology at all. You might acquire any transaction engine built in India and they won’t vary much in terms of functionalities. I tell you this because my team and I evaluated more than a dozen platforms and basically they do the same with certain differences. The price always is high because they’re built for huge markets and the usual buyers are banks and telecom companies, which have enough cash and potential customers attached to their existing core businesses.

When you’re talking of what determines the success or failure of an implementation you’ll have to say/hear that the difference resides on commercial approaches. That’s it.

No matter whether you’re a bank or a MNO, if you don’t have a right commercial strategy based on how people in every society make transactions and how companies have to deal with it, you’ll have nothing but millions of dollars less on your balance sheets.

So, I recommend you set aside tech discussions and start to think how your value proposal is gonna be deployed commercially. In Latam it won’t be easy implementing any initiative because of high rates of inequality and low access to financial services, but there’re huge opportunities based on this obstacles.

Think Out of the Box, outside is the way.