Mobilizing Money through Enabling Regulation

capability to receive and make payments, quickly and affordably, from and to any other person or entity from that store of value—in other words, to use mobile money. We are a long way from that goal today. Bank accounts are regarded as the traditional safe place to store money, yet a 2006 study estimated that globally perhaps only 1.5 billion people have bank accounts. Not all of these accounts have the level of speed or convenience—mobility—that comes from electronic banking, although the usage of e-banking channels has grown with the issuance of ATM and debit cards over the past two decades: in some developing countries, people still have passbook-based or domiciled accounts in which their money is effectively immobilized to cash access at one branch. At the same time, we have witnessed the amazing rates of adoption of mobile phone communications even in the poorest and most remote countries: in 2009, by far the majority of the earth’s population will live in areas with wireless reception, and four billion people will be mobile subscribers, most of them prepaid. Even if we account for the double counting that occurs because of multiple mobile subscriptions, it is clear that many more people are now in real-time voice or SMS contact with others across the globe, compared to the numbers using electronic financial services. What would it take to mobilize money fully? First, people need easy and affordable universal access to wireless telephony. This is not yet available: even though subscriber bases continue to grow rapidly in many developing countries, that growth may be limited by income, topography and market structure. However, the limits to mobile penetration are clearly not the binding constraint on