Everybody is discussing how the financial sector should be structured in the future. It is wise to start with the basic "utility" functions: funds transfer between parties (payments), and middle man between those who have saved and those who need to lend money.
These functions might very well be executed by quite different companies than those that call themselves banks. Look at these examples.
The M-PESA payment system , pioneered by Safaricom in Kenya. See this quote on GigaOM:
The idea was to enable users to send minutes to family members in rural areas, who weren't otherwise able to buy prepaid phone cards. However, Kenyans quickly came up with other uses. "Lots and lots of people were using it as a surrogate for currency," Eagle said. "[You] could literally pay for taxi cab rides using cell phone credit."
Safaricom realized a huge opportunity and started a mobile payment service called M-PESA. To call M-PESA a success would be an understatement, according to Eagle. "Within about a year, (Safaricom) became the biggest bank in East Africa." Today you can use your phone to pay for cab rides and electricity, to get money out of ATMs without owning an ATM card or even having a traditional bank account.
Eagle shared another striking example of the transformative power of mobile payments during his ETech talk. Rural communities used to have to pay a lot of money upfront in order to get a modern well capable of providing clean drinking water. Now, there are companies that install these wells for free, complete with an integrated cell phone payment system. Want some water? Just pay as you go with your M-PESA account.
Superficially unrelated is the observation (again by GigaOM) that Ebay is transforming itself to a payment provider: Paypal is growing so fast it will become the biggest revenue generator of Ebay. Om predicts they will change the name Ebay soon to Paypal.
Amazon on the other hand is becoming far more than a webshop for books. Their strategy to leverage their core competence of running a large computing cloud to supply other webservices is very succesfull. The introduction of the second generation Kindle electronic bookreader shows their transformation. A less well know asset is the fact that they are debtfree and rising a mountain of cash which is still growing. Ready to become a bank?
( Source: GigaOM)
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