How can I set up my own mobile money-transfer startup?
Payments
Asked by Question Bot02/Feb/20151 answer
1 Answer
F
Faisal Khan
Answered 02/Feb/2015
To setup a mobile money transfer company, you essentially have two options:
Both the options above would require that you partner up with a bank. A bank that specifically has the license (or permission) to conduct wallet based banking (i.e. branchless banking).
If you are able to find a bank, then you need to start your search for a wallet company. There are many such companies from Fundamo (owned by VISA, which means it is expensive), Utiba (horrible customer support), IDMission (powerful but expensive), Gemalto, Sequent, Tagattitude, to 100s of companies now offering wallet management applications like Xpwallet, etc.
With the Banking arrangement sorted out and a wallet app to run it on, you will need to then find an operator to run this for you. You could run this yourself, but since the question itself is being asked on Quora, I would say your experience in this field might be low to none, so in this case you will need to partner up with a company that knows how to run an online wallet. The bank could possibly do this for you, but then again, why would they need you.
If you are going to be opting for a carrier based wallet, then you're looking at a much simpler solution but one that is tied on to the USSD channel rather than any particular smartphone app.
In both cases there is a long drawn process on how users are on-boarded, how merchants are on-boarded, how fraud and other screening methods are applied, how accounting is done, how funds settlement is done, etc. (the list is quite exhaustive).
Needless to say, you will need a pretty large agent network to do the cash-in/cash-out for you (depending on the permissions you get from the regulator) and an adequately large enough network to handle the KYC and on-boarding process.
If to this you want to add, cross-border remittances, then you need a regulatory approval and tie-ups with whom you can connect and send across money (a sentence that sounds simple, but is incredibly complex).
- Wallet based, but carrier/bank agnostic, or
- Mobile Carrier based Wallet
Both the options above would require that you partner up with a bank. A bank that specifically has the license (or permission) to conduct wallet based banking (i.e. branchless banking).
If you are able to find a bank, then you need to start your search for a wallet company. There are many such companies from Fundamo (owned by VISA, which means it is expensive), Utiba (horrible customer support), IDMission (powerful but expensive), Gemalto, Sequent, Tagattitude, to 100s of companies now offering wallet management applications like Xpwallet, etc.
With the Banking arrangement sorted out and a wallet app to run it on, you will need to then find an operator to run this for you. You could run this yourself, but since the question itself is being asked on Quora, I would say your experience in this field might be low to none, so in this case you will need to partner up with a company that knows how to run an online wallet. The bank could possibly do this for you, but then again, why would they need you.
If you are going to be opting for a carrier based wallet, then you're looking at a much simpler solution but one that is tied on to the USSD channel rather than any particular smartphone app.
In both cases there is a long drawn process on how users are on-boarded, how merchants are on-boarded, how fraud and other screening methods are applied, how accounting is done, how funds settlement is done, etc. (the list is quite exhaustive).
Needless to say, you will need a pretty large agent network to do the cash-in/cash-out for you (depending on the permissions you get from the regulator) and an adequately large enough network to handle the KYC and on-boarding process.
If to this you want to add, cross-border remittances, then you need a regulatory approval and tie-ups with whom you can connect and send across money (a sentence that sounds simple, but is incredibly complex).