dotMobimobiForgemobiReadyDeviceAtlasgoMobi
background image

Global mobile statistics 2014 Section G: Mobile banking and m-money; Section H: Venture capital (VC) investment in mobile

Section Feature Image
Posted by mobiThinking - 13 Jun 2014
Twitter share icon Facebook share icon Google Plus share icon

FINDING YOUR WAY AROUND THE MOBILE STATS COMPENDIUM:

Home: Full index of contents and highlights • Section A: Mobile subscribers; handset share • Section B: Mobile Web; 3G • Section C: Mobile marketing, advertising and messaging • Section D: Consumer mobile behavior • Section E: Mobile apps, app stores • Section F: Mobile payment, NFC, m-commerce, m-ticketing and m-coupons • Section G: Mobile financial services (MFS) and m-banking • Section H: VC investment in mobile.

Section G: Mobile financial services (MFS) and m-banking

1) Users of mobile banking (m-banking)
1a) M-banking around the world: China; USA; Europe.
1b) Top banks m-banking customers

2) Mobile money (m-money)
2a) Kenya is the world leader in mobile money services

Section H: Venture capital (VC) investment in mobile

1) Mobile VC investment flows by quarter and sector
2) Top 10 companies receiving highest levels of funding
3) Most active VCs in mobile sector
4) Is mobile the new tech bubble?

Section G: Mobile financial services (MFS)

mobiThinking divides mobile financial services into two types:
1) Mobile banking (m-banking) which is banking services, such as transfers and bill payment, fulfilled by a traditional (high-street) bank via a customer’s mobile device. M-banking is usually offered via mobile Web and mobile app.
• Banks also offer SMS-based services. These are usually restricted to alerts, such as mini-statements, though some allow balance queries and other clever stuff. While these are popular with customers they are more of a value-added service, and are not strictly speaking m-banking services.
2) Mobile money (m-money) which is provision of banking-like services, such as money transfer and bill payment, via mobile device – these are normally fulfilled by an organization other than a traditional bank, usually a mobile operator. The pioneer is Kenya’s massively popular mPESA, which evolved from a peer-to-peer money transfer system into a highly sophisticated banking-like service. Usually these m-money services are messaging-based systems that work with any handsets, making them very popular in developing countries, in particular with people who do not have (have access to) a traditional bank account.
• Mobile wallets (m-wallets) offer similar m-money services, but these are restricted to smartphone users. Few m-wallets have shown much sign of success, so far.
• There is considerable overlap between MFS and mobile payment (m-payment), which is covered in Section F:. Often analysts include m-money transfer in estimates for m-payments.

1) Mobile banking (m-banking)

Juniper Research (January, 2013): predicts that there will be 1 billion mobile banking users worldwide by the end of 2017, up from 590 million in 2013.

1a) M-banking around the world: China; USA; Europe.

China is king of m-banking
mobiThinking’s research (May, 2014), see table below, shows that there are 352.1 million mobile banking customers at the top four Chinese banks, (according to their 2013 annual reports). That’s more people than live in the United States. The two largest banks, China Construction Bank (CCB) and Industrial and Commercial Bank of China (ICBC), have more than 100 million mobile banking customers each. That means each one has more than all US mobile banking customers put together.
Analysys International (January, 2014): In Q4, 2013, Chinese mobile users made transactions worth 4.7851 trillion Yuan (US $768.8 billion).
Forrester Research (May 2014): estimates that there were 51 million mobile banking customers in Europe in 2013 – 42 million mobile phone banking and 19 million tablet banking users. This is predicted to grow to 214 million in 2018 – 99 million mobile phone banking and 115 million tablet banking users.
Javelin Research (March, 2014): estimates that their were 95 million mobile bankers in the US in 2013 – up 40 percent from 2012. It forecasts that their will be 108 million in 2014; 119 million in 2015; and 130 million in 2016.
Forrester Research (May 2014): In the US, Chase and U.S. Bank tie for the top spot for their mobile offerings, followed by Wells Fargo, Bank of America, and Citi.
"Before banks can serve customers through mobile touchpoints, they have to ensure that customer can interact with them via mobile. Today, banks have to develop mobile banking services for many different smartphone and tablet platforms, not to mention mobile browsers. That's driving many firms to explore approaches like responsive design." Peter Wannemacher, Forrester.

1b) Top banks m-banking customers

Increasingly the world’s top banks are including the numbers of m-banking customers in their annual reports. Some still do not – perhaps out of embarrassment.
• The top Chinese banks dwarf the rest of the world in m-banking subscribers but some US banks are starting to show good progress in m-banking, while the European banks are miles behind.
• N.B. Chinese m-banking figures is mobile Web and mobile app, not SMS. The SMS-banking stats are even bigger: China Construction Bank (CCB) 199.5 million SMS banking subscribers and Agricultural Bank of China (ABC) has 197 million. mobiThinking drew the following research from studying the annual reports of the top global banks (according to Forbes); for more stats and analysis: mobile banking customers at world’s largest banks – the huge, the tiny and the AWOL.


Mobile banking customers at the top 12 global banks
Forbes
rank
Bank HQ location Mobile banking
customers
annual mobile
growth
Online banking
customers
Total
customers
Mobile percentage
of customers
1 Industrial and Commercial Bank of China China 100 million + 49.5% 390 million 432 million 23.2%
2 China Construction Bank China 117 million 38.9% 150 million 291 million 40.2%
3 Agricultural Bank of China China 83.0 million N/A 110.9 million 320 million 25.9%
4 JPMorgan Chase USA 16.4 million 24% 35.0 million N/A N/A
8 Wells Fargo & Company USA 12.5 million 23% 23.8 million 70 million 17.9%
9 Bank of China China 52.1 million 24.6% 101.1 million N/A N/A
13 Bank of America USA 14.4 million 19.8% 30.0 million 50 million 28.8%
14 HSBC Holdings UK 2.5 million N/A N/A 60 million 4.2%
16 Citigroup USA N/A N/A N/A 100 million N/A
24 BNP Paribas France 1 million N/A N/A N/A N/A
37 Mitsubishi UFJ Financial Japan N/A N/A N/A N/A N/A
43 Banco Santander Spain 2.6 million N/A 11.6 million 106.6 million 2.4%
Source: Banks 2013 annual reports
Except JPM and WFC: Q1 2014 report.
Via © mobiThinking

2) Mobile money (m-money)

Juniper Research (September 2013): 150 million (forecast) mobile phone users worldwide use their handsets for mobile money transfer in 2013. In 2018 there will be 400 million mobile money transfer users. Juniper warns that mobile money taxes introduced in Kenya and Uganda in 2013 are likely to curtail growth.
Juniper Research (October 2013): international remittances via mobile phones exceed US $10 billion (forecast) for the first time in 2013.
Gartner (June, 2013): Money transfers are 71 percent of total m-payments in 2013. Total m-payment users worldwide in 2013 (forecast) is 245 million making collective payments of $235 billion. This means mobile transfer users equate to 174 million, with total transactions worth $167 billion.
Gartner (June, 2013): forecasts that Asia pacific will overtake Africa as the largest region for mobile payments by 2016 worth $165 billion against Africa’s $160 billion.

Further reading::
The insider's guide to banking the unbanked.

2a) Kenya is the world leader in mobile money services

• Of the 31 million mobile subscribers in Kenya, 83 percent (26 million users) are subscribed to mobile money services. Communications Commission of Kenya (CCK), April 2014).
• The crux to m-money services is the ability to a) transfer funds from one handset to another and b) deposit and withdraw cash via a network of local agents. But m-money can be used in many other innovative ways. In Kenya these include including paying utility bills or school fees, making in-store purchases, m-ticketing, phone top-ups, withdrawing cash from ATMs, sending money home from 45 countries overseas, people even have their wages and stock dividends paid into their account. All of this is achieved without needing a bank account, bank card, a smartphone or a post-paid contract.
• Safaricom’s M-PESA service was the pioneer of mobile money in Kenya – and worldwide. Starting only seven years ago, M-PESA now has a reported 18.2 million subscribers, which would give it 73 percent of total mobile money subscribers in Kenya and, according to Mobile Transaction, today one quarter of the 44 billion dollar economy in Kenya runs through M-PESA.
All other Kenyan operators and some banks also offer m-money services.
• In 2012 Safaricom made more revenue from M-PESA than from SMS and data put together, according to the annual report.

Mobile money subscribers in Kenya, April 2014
  December 2013 December 2012
Total mobile subscribers 31.31 million 30.43 million
Mobile money subscribers 26.02 million 21.41 million
Number of Agents 93,689 62,300
Source: © Communications Commission of Kenya (CCK), April 2014). Via © mobiThinking

Further reading::
• The insider’s guide to mobile Web and marketing in Kenya.


Part H: Venture capital investment in mobile

1) Mobile VC investment flows by quarter and sector

Venture capitalists are investing more and more of their funds in mobile companies:

• Research by CB Insights (April 2014) finds that US VCs spent US $3.8 billion on mobile investments in 2013. Mobile has continued to attract serious funding in 2014, though not achieving the (record) $billion investments of Q3 and Q4.
• Mobile security was the hottest subsector in 2013, attracting 10 percent total funds, according to CB Insights. Concerns over device security and how companies are going to cope with the management of devices, has made companies such as AirWatch, which raised $200 million in Febuary 2013, and Lookout, which received $55 million in October 2013, attractive to investors. AirWatch was subsequently acquired by VMware for $1.18 billion in January 2014.
• Other subsectors that received top funding included telecom equipment, customer-relationship management (CRM), business intelligence (BI) and analytics, application development and advertising and marketing mobile subsectors. This all suggests that VCs are more attracted to businesses that provide essential services and tools to the companies that are building out their mobile offering, rather than to investing in the mobile ventures themselves… but there are some big exceptions.
• The standout business-to-consumer (B2C) subsector was travel, attracting 9 percent of 2013 investment. The taxi-cab/lift-sharing services Uber and Lyft both attracted huge investments, both in 2013 and subsequently. Uber raised $258 million in 2013 and $1.2 billion in June 2014, valuing the company at $17 billion. Lyft raised $60 million in May 2013 and $250 million in April 2014 (source: TechCrunch).
• See section 2: The top 10 companies receiving highest levels of funding in 2013.
• See section 3: Most active VCs in mobile sector.
• See section 4: Is mobile the new tech bubble?


Venture capitalist investment in mobile by quarter and subsector 2013 (US)
Quarter Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014
Total invested $718M $822M $1,116M $1,089M $931M
 
Mobile venture capital funding share by sub-industry 2013 (US)
  Sub-sector Funding share   Sub-sector Funding share
Security 10% CRM 5% Advertising +
marketing
4%
Travel 9% BI + analytics 5% Location-based +
navigation
4%
Mobile telecom
equipment
6% Application
development
5% Others 52%
Sources: © CB Insights (April 2014); CB Insights (Dec 2013). via: © mobiThinking

2) Top 10 companies receiving highest levels of funding and achieving the best exits

CB Insights (Dec 2013): Uber received the largest funding, $258 million, from US investors in 2013, followed by AirWatch, $200 million, and eRecycling, $105 million.
• The top mobile exits (acquisition or floating on the stock exchange) were CyOptics, a fibre optics components company, acquired by Avago Technologies for $400M in June 2013; and EdgeCast Networks, a content delivery network, acquired by Verizon for an estimated $350 million.


The largest VC-backed mobile financings in 2013 (US)
Company Type of business Investment; date Update Source
Uber Taxi-cab app. $258m New financing:
$1.2B; June 2014.
Uber
AirWatch Enterprise mobile device/security management. $200M;
Feb 2013.
Acquired by VMware
$1.18B; Jan, 2014.
VMware
eRecycling Mobile phone recycling. $105M;
Oct 2013.
  eRecycling
Flipboard Content aggregation app. $50M;
Sept 2013.
  Mashable
OpenPeak Enterprise mobility management. N/A   OpenPeak
Twilio Cloud-based telephony tools. $70M;
June 2013.
  Twilio
Snapchat Picture/video messages that disappear. $60M;
June 2013
New financing:
$50M; Dec 2013.
Forbes
Lyft Car-sharing service. $60M;
May 2013.
New financing:
$250M; April 2014
TechCrunch
Lookout Mobile device security software. $55M;
Oct 2013.
  Lookout
EdgeCast Networks Content delivery network. $54M;
July, 2013
Acquired by Verizon;
Dec 2013.
EdgeCast
 
The largest VC-backed mobile exits in 2013 (US)
Company Type of business Acquirer Price; date Source
CyOptics Fibre optics components. Avago Technologies $400M;
June 2013.
Avago
EdgeCast Networks Content delivery network. Verizon Est: $350M;
Dec 2013.
TechCrunch
MoPub Mobile ad exchange. Twitter Est: $350M;
Sept 2013.
TechCrunch
Jumptap Mobile ad network. Millennial Media Est. $225M;
Aug 2013.
Bloomberg
mFoundry Mobile banking and payment solutions. FIS $120M;
Jan 2013.
FIS
Sources: © CB Insights (Dec 2013); company & news Websites. via: © mobiThinking

3) Most active VCs in mobile sector.

• The private venture capitalist firm that invested the most in the mobile in 2013 was Andreessen Horowitz, the most active corporate venture capitalist was Google Ventures.


Most active mobile venture capital investors, 2013 (US)
Private VC investors   Corporate VC investors
1. Andreessen Horowitz   1. Google Ventures
2. SV Angel   2. Qualcomm Ventures
3. 500 Startups   3. Intel Capital
4. Bessemer Venture Partners   3. Verizon Capital
5. Greylock Partners   5. Samsung Ventures
5. Eniac Ventures   5. Motorola Solutions VC
5. Lerer Ventures   7. Steamboat Ventures
8. New Enterprise Associates   7. T-Venture
8. Draper Fisher Jurvetson   7. Vodafone Ventures
10. Kleiner Perkins Caufield & Byers      
Sources: © CB Insights (Jan 2014) via: © mobiThinking

4) Is mobile the new tech bubble?

• The enormous investments in, and seemingly incomprehensible valuations, of mobile ventures – particularly the (B2C) mobile companies, are scarily reminiscent of the dotcom boom of the 1990s. This has led to warnings that this is a new tech bubble waiting to burst – see Business Insider (Jan 2014). The main counterclaim comes from Mary Meeker (May 2014), but it should be noted that she does work for a venture capitalist, Kleiner Perkins Caufield & Byers (KPCB), that is one of the largest investors in young digital companies in the US (see above), so her enthusiasm for a buoyant tech market isn’t so surprising.


FINDING YOUR WAY AROUND THE MOBILE STATS COMPENDIUM:

Home: Full index of contents and highlights • Section A: Mobile subscribers; handset share • Section B: Mobile Web; 3G • Section C: Mobile marketing, advertising and messaging • Section D: Consumer mobile behavior • Section E: Mobile apps, app stores • Section F: Mobile payment, NFC, m-commerce, m-ticketing and m-coupons • Section G: Mobile financial services (MFS) and m-banking • Section H: VC investment in mobile.




Don’t miss:

• The 10 ways mobile search is different: implications for your mobile Web/search strategy
• US consumers will spend more time on mobile devices than PCs in 2014: three hours a day. When will marketers catch up?
• 2013 handset and smartphone sales and market share: 10 things you need to know
• EU unfetters the mobile Web, with plan to scrap roaming fees in Europe. When will the rest of the world follow?
• Mobile browsing stats: why do iOS users surf more than Android users?
• UK regulator benchmarks mobile/fixed broadband progress against EU countries
• The insiders' guides to world’s greatest mobile markets • Latest: Brazil
• Guide to mobile industry awards • Latest: Webby Awards 2014
• Mobile marketing resources: links to the most useful places on the Web (2014 update)
• Mobile SEO best practices for 2014
• Next-generation mobile ads: What is a demand-side platform (DSP) and real-time bidding (RTB)?
• Guide to mobile agencies
• Guide to mobile ad networks
• Mobile events 2014 • best conferences, great discounts and free tickets •
• The big compendium of global mobile stats
• Most popular content on mobiThinking in 2013


Posted by mobiThinking - 13 Jun 2014

mobiThinking's picture

mobiThinking focuses on everything you need to know on the business of mobile and web. With an exhaustive compendium of mobile statistics, practical guides to mobile agencies, ad networks, top mobile markets and more; interviews and analysis, industry events and awards.

comments powered by Disqus