Merchant Innovation

What Developed Markets Can Learn From Emerging Markets’ Payments

Developed markets are all about the move from plastic to digital while emerging markets are all about leapfrogging plastic and going right to digital. What each have in common is the mobile device and the desire to create a convenient way to enable payments – whether those payments are to merchants or other people. Mahindra Comviva’s SVP and Head of Mobile Financial Services, Srinivas Nidugondi, spoke with PYMNTS and shared his thoughts on how developed markets can take a page out of the emerging markets playbook as they develop and deploy mobile payments strategies.

It’s not news that smartphones and other mobile devices are rapidly affecting the way the world does banking and makes payments. What is, are the rising expectations that consumers in both developing and emerging economies have of their mobile financial services providers. No surprise, an easy, seamless checkout process continues to take priority. Mahindra Comviva is a global leader in delivering mobile financial services solutions in important markets worldwide for 15 years. Srinivas Nidugondi, Sr. VP and Head of Mobile Financial Services spoke with PYMNTS to offer his perspective on how to solutions providers can deliver a convenient and secure end-to-end mobile payment process for consumers and what the US markets can learn from their global counterparts.


You are new to the US Market but have been quite active in global, mobile financial services for a very long time. What are some of the projects and programs that you have enabled that our audience might be familiar with?



The mobile serves as a convenient, cash-free and card-free financial transaction medium, and it has become an important channel in addressing the needs of banked and unbanked or under banked economies all over the world. In developed economies, convenience is key. Consumers want to easily transfer funds on the go, check their account statuses, and make checks superfluous. The focus is on enhanced user experience through interactive interfaces and context aware services. On the contrary, in developing and emerging economies like those in Africa, South Asia and Latin America, a completely different paradigm exists. Mobile is the most advanced, life-changing piece of technology that citizens of these countries have touched, and they are comfortable with it, especially with respect to financial services.

Understanding these needs, we have architected solutions based on the multiple segments that exist in the market today, both on the issuing as well as the acquiring side. In consumers, there are three distinct segments that exist – the banked and carded, the under-banked and the unbanked. Similarly, on the acquiring side we have the SMBs and Large Format Retailers. Each of these user segments have distinctly different needs and we have created solutions keeping in mind the environment that these entities exist in and their needs when it comes to financial services.

Our mobile financial solutions product portfolio boasts over 110 deployments across 38 markets, serving over 500 million consumers globally. Our product portfolio offers financial and payment services including mobile money, branchless banking, mobile banking, mobile wallet and merchant POS solutions.  We believe the key to a good product lies in understanding the end user experience as much as the backend operations and maintenance. Hence our products while being secure, scalable and flexible also lays extreme focus on ease of use and intuitive interfaces for all users. One such example would be our mobile point of sale deployment in India with the largest private sector bank in the country and the largest processor globally. While end users rated their product experience a 8.5 on a scale of 10, the acquiring bank appreciated the easy to use backend interfaces and the speed and agility with which they could launch new services in the market.

We have also enabled the largest bank in UK and in Europe and South East Asia launch branchless banking and payments services on the mobile which have helped increase penetration without having to invest in physical infrastructure. With our widely deployed mobile money platform, it has been interesting to see how well the self service model works in emerging economies for unbanked and under banked segments as the primary need that is being served is to provide security which cash does not and enable remittances for the migrant population.



You bring a very important global perspective to the conversation of mobile financial services. What are the trends that you have seen in markets outside of the US that you think are relevant in the US market?



Our experience across 38 markets has reiterated our belief in the potential of mobile as a key instrument in bringing financial services closer to the consumer. The potential for mobile financial services is extremely promising; however, to reach its true potential, various stakeholders need to develop compelling solutions to bring together the requirements of both merchants and consumers for an optimum user experience, supporting a full range of banking and payment services across several devices and channels.

One of our key observations from our extensive experience has been that every market is different. Before even giving technology a glance, it is imperative that service providers carry out thorough research to understand their market, define their target segment and design an offering to address their specific needs. A one size fits all approach does not work well in any market and service design and the last mile delivery is key to the success of any deployment.

As an example, we can compare two mobile money deployments in Africa where the larger objective was to enable financial inclusion through the mobile. The reason that our customer in Zimbabwe is outperforming their competitors is that they understood the local market well. They realized early on that while a stored value account will act as a surrogate bank account, the most important factor for the user was that Zimbabwe supports dual currencies. While merchants accepted both US Dollars(USD) as well as Zimbabwean Dollars(ZWD), the change always returned in ZWD or in some cases was never returned owing to the weak ZWD. Thus digitization of cash not only enabled the consumers to stow their cash safely and allow them to send money home but also ensured that they paid the exact amount for any transaction thus mitigating financial loss. Thus from inception, the service was designed to support both currencies and solved a core problem that the consumer and the merchants faced. Therefore the trend that we see is that service providers who have a keen understanding of their market and target segment over perform their competitors.

From a consumer’s perspective, we have seen that peer to peer transfers remains the single most coveted service by end users. They do graduate to merchant payments which given its dependency on the acquiring side takes longer to make any significant contribution to the transaction mix.

Further, our highly successful mobile money offering in emerging markets like Africa, Eastern Europe and LatAm is what we see being replicated in the US with new service offerings from the likes of T-Mobile. We are one of the top 3 players globally in this space and we believe that our understanding of mobile payments domain, service designs and business models will help us contribute to its adoption in the US Market.



Give us a sense of your roadmap. Here in the US and around the world, what are you pursuing and what particular advantages do you have that you think position you well for success?



We believe that our strength lies in being able to focus on the user. Consumer experience is central to our products. Further from our customer’s perspective there are factors like security, scalability and flexibility which are hygiene and just as important. We bring with us extensive experience in both the financial services as well as the telecom domain. From a services standpoint, Mahindra Comviva’s experience in deploying over 40 products in over 90 markets gives us an understanding of the challenges posed by varying regulations, an ever evolving ecosystem and industry standards as well as porting our products to meet the varied business objectives of our customers, be it a telco, bank or retailer.

Our roadmaps, while keeping up with new technologies like NFC, BLE, HCE also focuses on faster time to market through open services framework and out of the box adaptors for faster ecosystem enablement.

Through our mobile banking, mobile wallet and mobile POS solutions, we enable our customers launch services in an any stage economy and design a customized service offering that would be relevant in the context of their target market. All our product platforms allow our customers to map and manage different business cases through the lifetime of the services. We will focus on enabling the use cases keeping in mind the usability, user experience and the needs of the consumer, the merchant and the service provider.

Our product offering is further augmented by our post sales support and service monitoring. Our product releases which are in line with the evolving industry guidelines and technologies, will help us ensure that our customers can grow and maintain a competitive advantage in their markets.





Banks, corporates and even regulators now recognize the imperative to modernize — not just digitize —the infrastructures and workflows that move money and data between businesses domestically and cross-border.

Together with Visa, PYMNTS invites you to a month-long series of livestreamed programs on these issues as they reshape B2B payments. Masters of modernization share insights and answer questions during a mix of intimate fireside chats and vibrant virtual roundtables.

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