Impact of Mobile Digital Money

Bangalore: It would not come as a surprise if we find ourselves in a cashless society in the near future. For CIOs, this would come as a fresh challenge, especially in developing countries, as they try to cope with respect to infrastructure, strategy and consumer preferences, reports by Irving Wladawsky-Berger in WSJ.

IT executives should heed to the dual aspects that mobile digital money might bring forth. Firstly, the surge of neoteric technologies and apps which as of now can be found in technologically advanced countries and secondly, recognition of the poorer sections of the society financially in introducing them to the commercial sector.

With regards to the first trait, a quintessential example would be for CIOs to come up with innovative technologies so that it enables retailers to offer mainstream shoppers gratuity tempting them to replace the ‘old fashioned’ swipe of plastic card with a tap of a phone. Moreover, they have to ensure viable technologies are brought to the table so that the consumers won’t have a problem with e-wallets.

As far as the impact on the less privileged class of the society is concerned, it can do wonders for them. As David Wolman mentioned in an article, “It has never been profitable to put bank branches in the slums and rural villages where poor people live … But phones are everywhere. Mobile technology is now being touted as a solution for getting financial services to the roughly one billion people who already have a phone but who don’t have a bank account.”

Roger Voorhies of the Gates Foundation further advocating the presence of mobile digital money states, “The digitization of publishing, music, and communications has created new business models and channels that increase access and reduce delivery costs. Shifting the bulk of the poor’s financial transactions into digital form is the catalytic change that can strip the majority of cash processing costs out of the system and make ongoing costs predictable. This means that the shift to digital can pave the way for affordable and far-reaching services that directly address poor people’s needs.”

Thus we come at a junction where we are presented with new realms with the advent of a cashless society. CIOs have to tread quickly but carefully anticipating the new challenges as well as the exploiting the opportunities with the rise of this new trend - mobile digital money.