White Paper: Does Mobile Money Impact Lives?

Event News Leave a Comment


By Dr. John Vong, Chief Technical Adviser, UNDP / Founder, Balipay


Mobile money is in vogue. Everyone heard of it. World Bank publishes it. Asian Development Bank engages in it. University research teams even showcase it. But what is mobile money’s economic or social impact on micro businesses? This thought leadership article is written based on a 3-month pilot study on the impact of mobile money in Cambodia.


A pilot study assesses the business behavioural change of micro-entrepreneurs as a result of having easier access to money via mobile phones. The ‘micro-entrepreneurs’ are taken to mean mom-and-pop stores and family-run stores in the alleyways or by the river banks. The results and evidence of the pilot study are expected to help social scientists and micro-banks to develop new financial service offerings to the world’s unbanked population.

The current statistics show:

  • 80% of the world population is reported to have annual incomes below US$3,000 in local purchasing power;
  • Within a five period (2005-2010), the global mobile phone subscriptions grew from 2.2 billion to over 5 billion (ie. 79% of the total developing world population);
  • 2.75 billion people do not have access to formal financial services for saving, borrowing or transacting;
  • In Cambodia, less than a million people have access to formal financial services, but there are 8.2 million mobile phones subscriptions;
  • The Cambodia 2011 Economic Census reported that 95% of the listed business establishments have less than 5 employees, and that 65% of the businesses are owned by females.
  • So mobile money becomes important especially in countries where there is a large rural population with many microenterprises. Secondly, women economics makes sense in developing markets.

Microenterprises in Cambodia

Micro-entrepreneurs are typically self-employed without adequate capital to form their businesses. They will either employ family members or have few employees. Also most micro-enterprises may not necessarily comply strictly with legal requirements in operating their microenterprise and are considered informal. It is possible that the business operates from home with the business income supplementing total household income. It is suggested that the micro-entrepreneurs are actually being by-passed by the employment market. An ‘unemployed worker’ starts a small enterprise to run, while waiting for a job to hire them. Furthermore micro-entrepreneurs are in the informal sector due to lack of access to credit, the inability to obtain an approved business license, or being prevented from commencing a business.

Mobile Money Services

The use of mobile phones to provide financial services across developing countries has been a remarkable technology story in the past decade. Mobile money services have been given many names, such as mobile banking (m-banking), mobile payment (m-payment), mobile transfers (m-transfers) and mobile finance (m-finance). The mobile phone has been widely used as a channel for providing microfinance services, hence the term ‘mobile phone banking’ or ‘mobile money services’.

In 2008, a mobile money service called WING Money Cambodia (WING) was launched in Cambodia to provide basic financial services through mobile phones. By the end of 2011, WING has reached over 350,000 registered mobile money account users with services available in all of Cambodia’s 24 provinces and has processed more than 220,000 mobile financial transactions.

The Field Work

The 3-month pilot study undertaken in 2011 seeks to generate an inductive theory on a social phenomenon. Face-to-face interviews and observational research were conducted in six rural provinces to analyze customer perceptions and experiences on payment delivery, ease of use and socio-cultural changes in transitioning from physical to electronic cash. 120 users of WING mobile money were approached for in-depth interviews.

The responses of 35 respondents that were considered most relevant to the research were analyzed. The 35 respondents consisted of 20 males and 15 females: 15 micro-entrepreneurs, 5 employees of micro-enterprises, 5 high school students, 3 WING rural agents, two soldiers in a remote hinterland, 1 coast guard, one farmer, 1 vegetable wholesaler, 1 meat vendor and 1 monk. The research analysis follows six distinct phases viz: (a) organising the data; (b) generating categories, themes and patterns; (c) coding the data; (d) testing the emergent understandings; (e) searching for alternative explanations; and (f) writing the data analysis.

The Impact

It was observed that small businesses located strategically in rural towns were appointed to provide mobile money services on behalf of WING. The benefits to them as well as small business owners with mobile money accounts have gone beyond from being just a revenue channel or payment service (phone top-up, transfer, deposit and withdraw money), to becoming a business solution for reducing operational costs and increasing profitability. Mobile money services appear to have made significant changes on individual financial capability behaviours.


The evidence shows that the mobile money service is gaining market acceptance, especially when used for daily business transactions in rural Cambodia. By having easy access to electronic money, it has changed and improved the livelihoods of even the most ordinary Cambodian.

The study suggested that mobile money services has the greatest potential to improve the micro or small business trade supply in terms of reduced operational costs, higher profit margins and higher market access opportunities.

Micro-enterprises have unique and varied needs. Understanding the economic and entrepreneurial impacts can provide invaluable insights for government regulators, financial institutions and technology service providers to formulate inclusive growth policies and to design mobile financial services, for not only micro-entrepreneurs but also the unbanked and poor.

Adapted from:

Vong, J., Fang, J., and Song, I. (2012). Delivering financial services through mobile phone technology: a pilot study on impact of mobile  money service on micro-entrepreneurs in rural Cambodia. International Journal of Information Systems and Change Management, Vol. 6, No. 2, 2012, pg 177-185.

Want to know more insights for the Indonesian market? Check Dr. John Vong at Cards & Payments Indonesia 2016, 16th to 17th November at the Pullman Central Park Jakarta, where he will delivering the closing keynote on the subject of mobile money and financial inclusivity for the Indonesian market. CLICK HERE to find out more

Leave a Reply

Your email address will not be published. Required fields are marked *