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A different mobile banking world

The world of mobile financial services here in the UK is coming on leaps and bounds following recent announcements from Orange and Barclaycard, and also from O2 to bring mobile contactless applications to the masses. However, having reviewed the market in the Middle East recently, I realised that although perceived as a region full of wealth and driven by innovation, the mobile banking landscape there is worlds apart from the one people would envisage.

Firstly, the Middle East is a diverse region with vast differences from country to country whether that be in consumer habits, languages or cultures. Android and iPhone devices are still a luxury reserved for the minority of high net worth individuals, mainly concentrated in affluent centres like Dubai. For the majority of people in the Middle East, smartphones are still largely unaffordable. In the UK, an obsession with new and trendy gadgets is clearly fuelling the uptake of smartphones whereas even if many in the Middle East could afford one, the desire to have this device just simply isn’t there.

Nevertheless, this doesn’t mean that demand for mobile banking is not present in this region. On the contrary, the growth of mobile usage means that mobile banking, like in many less developed parts of the world, is the only way in which the financially excluded can bank. So conversations with local banks in the Middle East have told me that although consumers  are not yet asking for banking apps on their iPhones,there is certainly a desire to be able to mobile bank in other ways such as through SMS. For example, the Middle East has a large migrant community that often want to be able to send money back home to their families. As a result, mobile remittance is big business in the Middle East and offers huge opportunities to companies looking to enter the region.

Along with opportunities, however, come challenges and there are notable hurdles that Western companies wanting to take mobile banking to the Middle East will need to address. The variety of languages and cultures across the region will obviously put organisations that are used to working in multicultural environments in better stead. More importantly, companies that just focus on a specific application for a specific mobile device will fare worse than those that can provide services and capabilities to suit all needs and across all levels of devices. Tailoring applications and services for the diverse customer bases in the Middle East, that in turn creates product longevity, will be key.

Without a doubt, there are wide ranging differences across the Middle East that will influence the way in which mobile financial services take off in the region. Yet at the same time, it is this wide range that makes the Middle Eastern market so exciting and an interesting space to watch.


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