The GSM Association (GSMA),  the global trade association for mobile operators, has launched a pilot programme aimed at tapping the ubiquity and ease-of-use of mobile communications to enable the worlds 200 million international migrant workers to easily and securely send remittances to their dependents, many of whom dont have bank accounts. By exploiting the extensive reach of the mobile networks, the GSMA believes the programme will complement existing local remittances channels and make transferring money internationally significantly more affordable.
Spearheaded by a group of 19 mobile operators with networks in over 100 countries,  and representing over 600 million customers, the GSMA believes the programme could double the number of recipients of international remittances to more than 1.5 billion, while helping to quadruple the size of the international remittances market to more than $1 trillion (513 billion) by 2012.
To combine the strengths of the mobile and financial ecosystems, mobile operators are partnering with banks at a local or regional level, while the GSMA is setting up a pilot with MasterCard Worldwide, whose cards and network provide international authorisation, clearing and settlement. The GSMA and MasterCard, which has a 25,000 member-bank network, plan to pilot a global hub that will link together national markets and the local payment systems run by mobile operators in partnership with those local banks. The hub will enable migrant workers to trigger international money transfers using their mobile phone, and their families to be notified via their mobile phones.
“The creation of a global hub will enable the mobile networks, which now cover more than 80% of the worlds population, to offer the worlds burgeoning migrant population a convenient way to securely and cost-effectively transfer money to their families back in their home countries” says GSMA CEO Rob Conway. We are mobilising financial services for the billions of people who are unbanked and the underbanked.”
For MasterCard Worlwide, Roy Dunbar, President, Global Technology and Operations, adds:
“In its pivotal role at the heart of commerce, MasterCard has always been committed to harnessing its payment card products and advanced technology to help drive innovation, pioneer new forms of payment and help steer the future of global commerce. This pilot provides a unique opportunity to use our global payments products and platform to help open up new business opportunities in developing countries. We look forward to working with local markets and partners to bring much needed payment and money transfer alternatives to the vast community of underbanked, as well as all consumers wishing to transfer money internationally.”
The GSMA is also working with CGAP (the Consultative Group to Assist the Poor), a microfinance group housed at the World Bank, and the UK Governments Department for International Development, to conduct a survey of the regulatory environment in about 20 countries, as a precursor to discussions with regulators in these countries about creating the optimum regulatory framework for money transfer, and eventually, mobile banking and mobile commerce.
Through its Development Fund, the GSMA will also work with mobile operators and financial services companies in individual countries to develop innovative approaches to using GSM mobile networks to further extend the role of mobile technology to deliver greater financial inclusion and lessen the digital divide.