Monitise: Growth Through Partnerships

Earlier this month, Monitise, the UK-based mobile banking provider, announced that its European business has now reached month-to-month brake even.  In less than 10 years, Monitise has struck up partnerships with with most UK banks, including HSBC, Lloyds TSB, RBS and NatWest, signed up more than 3 million customers and is processing more than 10 million transactions per month. 

Key to Monitise’s success has been its flexible banking platform that allows it to work with all types of banks and carriers.  Moreover, it has a range of technical platforms that enable users to perform a range of banking services, such as check balances, view statements, pay bills and receive alerts, on mobile phones of all types, from SMS to iPhone apps.

However, what makes Monitise one of the most exciting companies in the mobile banking space is the partnerships it has struck up around the world.  Through these partnerships, Monitise is becoming the leading player globally and is entering the payments space. 

In 2009, Monitise announced a strategic alliance to develop mobile banking solutions for Visa, which would take a minority stake in Monitise.  This partnership has proven to be very powerful in positioning Monitise as an industry leader and facilitate global expansion.

In the US, Monitise partnered with FIS and entered as the first multi-bank, multi-carrier mobile banking platform.  The venture has proven successful and has now signed partner agreements with nearly 250 banks.

In Asia Pacific, Monitise announced a joint venture with First Eastern and will launch in Hong Kong as the first market.  Beyond Hong Kong, the Monitise has its sights on China, Japan, ASEAN and the Middle East.

Recently, Monitise has also announced launches in India and several African markets, such as Uganda and Nigeria.  In India, it will work with Visa and is interestingly integrating mass transport ticketing with its standard banking platform.

In addition to its geographic expansion, Monitise is also making very interesting moves in the payment space.  In February 2010, it announced that it would integrate Device Fidelity’s NFC capabilities in its global platform.

Furthermore, in November 2010, Monitise formed a join venture with Best Buy and Carphone Warehouse founder, Charles Dunstone, to develop an NFC network in the UK.  This network would initially leverage Monitise’s broad banking partnerships in the UK, Best Buy’s retail presence and Dunstone’s retail experience, to develop the network.

In December 2010, Monitise announced a partnership with ViVOtech, a leading near field communication (NFC) software developer, to deliver mobile phone payments services to banks across the United States.  With Monitise’s already broad base of bank partnerships, this deal could make it a major player in contactless payments when NFC enabled handsets are launched later this year.

In less than 10 years, Monitise has become a leading, global player in mobile banking and payments.  With its open mindset and platform, it has successfully forged powerful partnerships that have enabled it to build an emerging global presence and expand its product capabilities to contactless payments, mass transport ticketing and couponing.  Undoubtedly, Monitise will continue to strike up new partnerships and expand in new business areas, and is definitely “one to watch”.  

MasterCard: Leading the way in Prepaid

I have previously written about the opportunities in prepaid and the truly transformational potential of this product, both for the payments industry and society at large. 

Firstly, it is ideal for underserved markets, such as the unbanked population in emerging markets or the teen market in developed markets, and consequently has enormous scope for growth. 

Secondly, for two important reasons, this market may be a leader within disruptive product innovation; (1) emerging markets do not have a fully developed cards-based infrastructure and may therefore leapfrog to mobile payments and (2) the processing infrastructure for prepaid is relatively new and more open for mobile and online applications.

MasterCard is among the leaders in this space and have announced a number of interesting programs over the last years.  Let’s have a look at a few of these programs that demonstrate different applications of prepaid:

· US Social Security Administration: partnership with the government to replace checks for social security payments.  In addition to being more cost efficient, convenient and safe than checks, prepaid is also a greener alternative

· Walmart: partnership with Walmart to replace cash and checks from their payroll program.  The benefits are similar to the Social Security partnership and the potential is enormous

· Univision: partnership with the largest US-based Hispanic TV channel to market prepaid products to the Hispanic population of the US.  This segment includes many migrant workers and has the potential of including many unbanked people in the financial sector

· TravelEx: MasterCard recently announced it’s acquisition of TravelEx’ portfolio of MasterCard branded multi-currency prepaid cards for $459m.  The product is seen as a convenient and secure alternative to traveller’s checks and is part of an ongoing effort for MasterCard to grow its international business through acquisitions

The combination of tremendous market potential with transformational product innovation is sure to make prepaid one of the most exciting spaces of the payments industry over the next years.  MasterCard has demonstrated its commitment to this opportunity and if it continues to develop its product and strike up exciting partnerships, it will no doubt see huge rewards.