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UNECA International Partnership Conference: Doing business with Africa Tenerife, March 2010 Why mobile payments? African and Latin American experiences.

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Presentation on theme: "UNECA International Partnership Conference: Doing business with Africa Tenerife, March 2010 Why mobile payments? African and Latin American experiences."— Presentation transcript:

1 UNECA International Partnership Conference: Doing business with Africa Tenerife, March 2010 Why mobile payments? African and Latin American experiences Laura Recuero Virto Economist Competitiveness and Structural Analysis Desk OECD Development Centre

2 Economic Outlooks Innovation and New Technologies 1.Economic overview & annual thematic focus 2008: Development in Latin America (telecoms) 2009: Fiscal Policy 2010: Migration (mobile payments and remittances) Special 2010 Report: Innovation in Latin America 2.Structural analysis of development challenges 3.10 country notes 1.Economic overview & annual thematic focus 2007: Water and sanitation 2008: Technical & vocational skills 2009: Innovation & ICT 2010: Domestic Resource Mobilisation 2.50 country chapters 3.Statistical annex and indicators 2-10

3 Why mobile payments? Distribution networks The key success of mobile payments is the size of their distribution networks Source: Wireless Intelligence (2008), Beck, Demirguc-Kunt and Martinez Peria (2005) Network Coverage among the Population (%) Network Coverage in Land Area (%) 3-10

4 Why mobile payments? Transaction costs (I) Source: OECD Development Centre, based on Recuero Virto (2009) Latin America & Caribbean Africa Transaction costs in remittances (percentage of total) % 11% 7.2% 9.7%

5 Why mobile payments? Country of origin (I) DestinationOriginNumber of Money Transfer Operators Transaction cost (%) for USD 200 BrazilJapan Dominican RepublicThe Netherlands HaitiCanada HaitiFrance JamaicaCanada PeruJapan SurinamThe Netherlands Low presence of Money Transfer OperatorsJapan, France, Canada, The Netherlands High presence of Money Transfer OperatorsUS, Spain, UK Latin America & Caribbean Source: OECD Development Centre, based on Recuero Virto (2009)

6 Why mobile payments? Country of origin (II) DestinationOriginNumber of Money Transfer Operators Transaction cost (%) for USD 200 AngolaSouth Africa BotswanaSouth Africa LesothoSouth Africa MalawiSouth Africa MozambiqueSouth Africa GhanaThe Netherlands AlgeriaFrance MoroccoGermany Low presence of Money Transfer OperatorsSouth Africa, The Netherlands, France, Germany High presence of Money Transfer OperatorsUS, Spain, UK Africa France and The Netherlands are the most promising countries of origin Source: OECD Development Centre, based on Recuero Virto (2009)

7 Why mobile payments? Volume of remittances Mobile payments are more likely in countries attracting large volumes of remittances Countries with a large volume of remittancesRemittances in USD million Transaction costs (%) for USD 200 Latin America & Caribbean Central America andMexico24, MexicoEl Salvador3, Guatemala3, Honduras2, South AmericaBrazil7, Colombia4, Ecuador3, Peru2, CaribbeanDominican Rep.2, Africa North AfricaAlgeria5, Egypt3, Morocco6, Western AfricaNigeria5, Source: OECD Development Centre, based on Recuero Virto (2009) 7-10 ? ?

8 Why mobile payments? Small amounts (I) Source: OECD Development Centre, based on Recuero Virto (2009) Latin America & Caribbean Africa 5% 6.4% 3% 1.2% 8-10 Transaction costs in remittances (percentage of total)

9 From mobile payments to mobile banking? Source: OECD Development Centre, based on Recuero Virto (2009) Regulation is essential for mobile payments, public incentives for mobile banking The need 9-10

10 AEO.org Africas economic portal for policymakers The latest developments in Africas economies Brings together the data & research from eight years of AEO Interactive database of all AEO data and statistics Complete and updated country notes Promotes original research by African researchers and institutions AfricanEconomicOutlook.org 10-10


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