The total value of mobile money transactions processed in the Middle East last year has grown at cumulative annual growth rate (CAGR) of 57.9 per cent over the period of 2009-2014, a report said.

However, the user base is still very low as compared to other regions with only 2.1 million people using mobile payment services in 2013, added the Global Money Market Report from Ken Research, a leading global industry research and information service company.

Factors such as large number of migrants, transient workers and swiftly growing mobile user base have been paving the way for growth of mobile payments market in the Middle East region.

Meanwhile, Africa accounted for nearly 70 per cent of the world’s active mobile money customers in 2013, the report highlighted.

In 2009, Asia Pacific accounted for the highest number of mobile payment users worldwide, followed by Europe and North America. Consequently, the region also noted the highest share in the transactions being operated through mobile devices, which was registered at 71.2 per cent in 2009.

The value of the mobile money transactions in North America has expanded at a CAGR of 35.8 per cent. North America mobile payment market is extremely fragmented and cumbersome, featured with technological splits and battling business models, said Ken Research in the report.

Europe registered a share of 6.7 per cent in global mobile money transitions, as observed in 2009, which has fell down to only 1.1 per cent. The estimated value of transactions processed via mobiles in Europe was registered at $51.2 billion.

The Latin American mobile payments industry has increased at a decent pace over the period of 2009-2013, however it is expected to witness brisk growth in the coming years, with increasing efforts of operators and banks to extend their offerings, banking upon the technology of mobile payments.

The mobile payment market has gained the support of the government in various economies, with the region witnessing increasing number of collaboration of MNOs and financial institutions to roll out services across different countries.

In India, 60 per cent of total online payments were made from top metropolitan cities such as Delhi, Mumbai, Kolkata and Chennai in the financial year (FY) 2014.

Additionally, cities such as Bangalore, Hyderabad, Ahmedabad and Pune accounted for 25 per cent of total online payments made in FY 2014.

The M-Wallet market in India is segmented by open loop, closed loop and semi-closed mobile wallets. Mobile wallets in the country presently can be issued by banks or non-bank entities which have been certified by the Reserve Bank of India.

Wallets issued by the banks provide higher benefits such as a higher fund transfer limit and cash withdrawals through ATM. Semi-closed loop is a prepaid wallet offered primarily by the non-bank entities as licensed prepaid instrument issuers. The cash-out or cash withdrawal facility is not allowed in this model.

The prime benefits of usage of mobile money include lower costs, faster speeds and ease of accessibility. This is of crucial importance in the third world countries, where technology sublimation has fostered a rather well-built mobile infrastructure and services have witnessed immense traction in the number of users.

The development of various mobile financial services including mobile insurance, mobile credit and savings has enabled service providers to extend their reach of the product offerings through alternate channels.

The mobile insurance industry has been gaining foothold in the recent years, supported by the involvement of specialist intermediaries, which have created commercial and partnership models which have been accelerating product launches. – TradeArabia News Service