The Swedish network group’s mobile wallet platform is helping providers to develop low-cost, inclusive, secure payment services that advance progress towards achieving many of the United Nations Sustainable Development Goals
The recipe for success in today’s cut-and-thrust world of business can be tricky to ascertain. Certainly, great products. But competition is stiff, so excellent marketing is a must, too. Increasingly, companies also see ethics as an important differentiator and balance-sheet booster.
Swedish network group Ericsson, for example, has remained on top for just short of 150 years, thanks to its world-leading technology and, more recently, a strong emphasis on ethical leadership. As its 2022 annual report states: “To be an industry leader, market and technology leadership are not enough. We also need to be an ethical leader. A cornerstone in Ericsson’s strategy is the ambition to be a relevant driver of positive change.”
One highly effective way the company drives positive change is through facilitating mobile financial services. Using the Ericsson Wallet Platform, an API-first fintech platform, telecom operators and financial institutions are able to provide money services that people can access via a mobile device. This is driving financial inclusion and wellbeing in low and middle-income countries across Africa, Latin America, the Middle East and Asia Pacific, where access to traditional banking services is low. As a result, many are moving towards achieving some of the United Nations Sustainable Development Goals (SDGs).
“Our platform provides the infrastructure, the rails for the mobile money service providers. And people are surprised to hear that mobile money touches on 13 of the 17 SDGs, some directly and others indirectly,” explains Michael Wallis-Brown, Head of Mobile Financial Services at Ericsson.
The SDGs falling into the direct bracket are: SDG 8, which focuses on expanding access to banking, insurance and financial services to all; SDG 9, with its aim to increase access by small-scale businesses to financial services, including affordable credit; and SDG 10, which is about reducing inequality.
“Within SDG 10, for example, is a goal to reduce remittance costs to less than 3 per cent of the transfer value. The World Bank found that for sending $200, banks in low and middle-income countries typically charge 11 per cent, post offices 6.45 per cent and money-transfer operators 5.2 per cent. Mobile money average charges are at least 3.45 per cent. In many mobile money services powered by Ericsson Wallet Platform the remittance charge has dipped below 3 per cent. When so few SDGs have been achieved, it’s great to be able to say that we’ve helped achieve this one,” he explains.
Wallis-Brown describes the platform as a hidden gem within the company, but while it might be invisible to the consumer, it’s well recognised as an industry leader. In fact, Juniper Research ranks it as the number-one digital wallet platform in the world. Used in 24 countries by leading mobile money service providers, it has enabled more than 400 million mobile wallets and every month handles more than 2.8 billion transactions, worth in excess of $40 billion.
Consumers and businesses alike are drawn to mobile money by its speed, security, the reliability of the networks, low cost and ease of use. As a result, about a third of all adults in Sub-Saharan Africa now use mobile money, while in Ghana, where penetration is one of the highest, that rises to 60 per cent.
Meanwhile, mobile money also indirectly provides support for the vulnerable, a safety net for farmers, gender equality, improved access to education and a healthier population. There’s also evidence that it facilitates improved access to electricity, clean water and sanitation and reduces corruption.
“Before mobile money services, people might transfer money using a paid-for service from one of the big transfer companies. If they couldn’t afford that, they might ask a bus driver or an acquaintance to take it. Now millions use mobile money for a secure, low-cost, direct relationship between them and who they want to pay or send money to. When that service is financial aid, insurance payouts or education funding, it is also helping to cut corruption and fraud because help goes directly to those who need it,” he says.
Last year in Pakistan, for example, floods affected more than 33 million people and caused more than $30 billion of damage. In the past, fraudsters have taken advantage of such disasters to syphon off donated funds and aid. This time, payment app Easypaisa, running over Ericsson’s Wallet Platform, created a quick and secure way for people to donate in just a few taps.
New benefits keep coming as more services are created to run on the platform. “There have been more than 24,000 developers who have experimented in the MTN Mobile Money Open APIs sandbox and over 1,600 partners are live in production,” says Wallis-Brown. “It’s not just about creating a digital financial service, but also enabling payments in other technology services – health tech, agri-tech, solar tech, edu-tech and ecommerce in a whole ecosystem.”
The sandbox was jointly developed by Ericsson and telecoms operator MTN, one of its biggest customers in Africa, and is free to use. “It’s virtual, so once you register you can start integrating and testing in a safe environment,” he says.
“Thanks to our technology, people can make better decisions about the money they have,” Wallis-Brown says proudly. “They can budget and plan. They can build a credit rating based on mobile money transactions, so they can get loans. And they can pay into savings and pension schemes.” The platform today supports more than 500 use cases from remittances and merchant payments to financial-aid disbursements and banking services.
The subsequent improvement to people’s lives can be transformative, something people working at Ericsson are conscious of – and proud of – helping to build morale and encourage loyalty. Wallis-Brown says: “The mobile wallet platform is enabling people to engage with the formal economy in their countries. We might be helping to keep their savings safe or grow their business, so they have a better standard of living. Not every company can say that.”
Indeed, companies like Ericsson are helping to shift the dial from financial inclusion to financial wellbeing, proving they can not only be technology leaders, but ethical leaders, too.
- This article was created as part of a collaboration with Comms for Good, a corporate social responsibility initiative founded by FirstWord producer Kate Bolton