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19 March 2024

Nokia takes 'mobile' cash to next level

Nokia's service could become an attractive business model for consumers. (AFP)

Published
By Nancy Sudheer

Mobile phone manufacturer Nokia plans to move into the mobile payments market globally next year.

A mobile financial service called Nokia Money will enable users to send money to others by typing in the recipient's mobile number.

They will also be able to buy products and pay for services, settle utility bills and refill prepaid SIM cards on their phones.

The service will be accessible 24 hours a day from anywhere, creating savings in travel costs and time. Nokia is building an extensive network of Nokia Money agencies where consumers will be able to deposit money in their accounts or make withdrawals.

Finland-based Nokia said the service would be run with mobile payment company Obopay and was based on that company's payment platform. Nokia invested in Obopay earlier this year. The service will be open and interoperable with other payment systems.

The Nokia Money service was shown for the first time last week at Nokia World in Stuttgart, Germany, and the company plans to roll it out gradually to selected markets, beginning early 2010.

Nokia is not new to the financial service segment as it offered WAP and banking applications using text messages for purchases and services as far back as 2000 and 2001. These services were implemented with European banks such as

Barclays, Hypovereinsbank and Nordea.

Nokia's service could become an attractive business model for consumers, participating partners and the manufacturer.

A spokesman for Nokia in Dubai declined to say when the service would become available in the Middle East.

A source at the company said: "We believe mobile financial services offer a market opportunity with long-term growth potential.

"With more than four billion mobile users and only 1.6 billion bank accounts, the demand for access to financial services is offering a large opportunity when combining the mobile device with simple but powerful capabilities."

Nokia will not operate as a bank but will partner with licensed banks to roll out the service.


How customers will use the new Nokia service?

Let's take the example of a taxi driver – we'll call him Jamal – who wants to use Nokia Money.

Jamal does not have a bank account and, with a job involving the exchange of cash all day, he is afraid of theft. He is also worried about the cost and difficulty of sending money home to his family, who live many miles away in a rural area.

Jamal starts most days with a quick visit to his local shop – one of the increasing numbers of authorised Nokia Money retail agencies all over the country. He transfers cash from last night's fares to his Nokia Money account on his mobile. Previously he carried money with him, making him a target for thieves.

Business has been good this week so a little later in the day, he transfers money to his wife. This happens instantly, saving them both a lot of time. Previously he would have had to travel to the money transfer office, queue up and fill in forms – and it would still be a number of days before his wife received the funds.

He is smiling because he knows his children will get a good meal tonight.

His wife is happy, too, as she won't have to wait for the money or organise a special visit to the money transfer agent in the town. Now she visits her local shop and withdraws cash for groceries the same day.

That evening Jamal tops up his prepaid wireless Nokia Money account and treats himself to a new ring-tone simply by paying direct from his Nokia Money account.

 

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