mimoney offers tap 'n pay

"Mobile phones have become the centre of people's lives. They reside in the palms of our hands and enhance the things we do every day - communication, entertainment, shopping and payments."

There are estimated to be 45 million mobile phones in South Africa. Mobile banking is now the fastest-growing retail banking channel, and that it is changing the way retailers interact with customers. "This increases online connectivity by three times its traditional penetration and is more than twice the size of the active banking market.

"We have already seen banks partner with mobile operators, as sales of mobile far out perform the rate of debit and credit cards issued."

While there is a drive to provide wallet and API solutions on smart phones as new retail channel entrants, payment innovation on the mobile phone, particularly in developing countries and in South Africa, tends to concentrate on the movement of cash between sender and receiver.

"These virtual money solutions are servicing a previously underserved market and our retail partners are enjoying phenomenal month on month growth with these services," she added.

Mobile money soars

A large amount of money is being spent in virtual form around the globe. For example, online payment mechanism PayPal's total payment volume for 2010 was nearly US$92 billion and demand for Apple paid for downloads totalled over $300-million in September 2010 alone.

In South Africa only 0.3% of total retail revenue is attributed to online sales, although the country's online industry is valued at R2 billion a year. "Virtual currencies and mobile connectivity will rapidly change these statistics as we watch the payments landscape change at warp speed," Mitchely said.

She cautioned that the ubiquitous adoption of e-currencies as serious contenders to cash, credit and debit cards was dependent on their being easy to use, convenient, secure and low to no transaction fees. Moreover, because of convenience and proliferation, mobile phones are becoming the payment instrument of choice over card, EFT and cash payments.

Tap 'n pay

One of the latest developments, near field communications (NFC) technology, or tap and pay technology, turns cellphones into devices that deduct the price of an item off one's virtual cash balance when they are tapped against a payment point.

mimoney is powering NFC transactions across university campuses, transit networks, events and loyalty eco-systems, assisting the growth of adoption of virtual currencies.

While NFC products are still in their experimental life stage, Mitchely believes mimoney is the virtual money system to empower NFC.

"We have designed mimoney in such a way as to be open to integration with all other payment platforms - it is thus bank agnostic and can enable payments in any mobile wallet, NFC card or phone in the virtual space, or at physical point of sale," she added.

At the same time, this South African Reserve Bank approved e-currency continues to gain market share by taking steps to ensure that it is as attractive to both retailers and consumers as possible. Over 25 merchants already accept mimoney and this number grows every month.

For more information, go to www.mimoney.co.za.