By Gemma Simpson, 12 February 2007 17:15
NEWS
Vodafone has joined forces with Citigroup to offer an international money transfer service.
The new service - due to be officially launched at the end of the month - will let Vodafone customers in the UK send money, typically to family or friends in other countries, using either a mobile phone or website.
The mobile remittance service is initially rolling out in Kenya, with other countries lined up.
When a payment is made the recipient is notified of the transfer using two text messages - one containing an alert and the other a secure PIN number.
The recipient can then use the text messages in a bank or with an in-country mobile network provider to redeem their cash after answering a series of security questions.
Although the person sending the cash must use the Vodafone network, the recipient can be on any network or go to any bank to redeem the funds.
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A Vodafone spokesman said the initiative combines Citigroup's well-developed global network and payments capabilities with Vodafone's global reach and brand recognition.
The Vodafone spokesman said there are plans to launch a Vodafone-branded international product in the near future, probably by the end of 2007, with Poland and India likely areas to be targeted.
A Citigroup spokeswoman told silicon.com the developing world has a lot of potential for the mobile payment industry and the bank will seek out other mobile network partners.
Chris Coffman, senior analyst with Informa, said Eastern Europe makes sense as a next step, for companies offering m-payments, because it is a more developed market compared to Sub-Saharan Africa or parts of southeast Asia - and it has high levels of migrant workers within the EU.
Vodafone owns or is associated with a lot of networks in the region so targeting Eastern Europe makes particular sense for that operator, Coffman added.
Vodafone is upping its game in India too - with a $11.1bn deal for a controlling stake in India's Hutchison Essar announced in the last 24 hours.
The Vodafone and Citigroup tie-up coincides with the GSM association leading a similar project. Nineteen mobile operators will create a global system for hundreds of millions of migrant workers to send money home over their mobiles.
Informa's Coffman said there is room in the market for both schemes to be successful because so few people hold bank accounts in the developing world and there is a lack of good alternatives.
Vodafone in separate news also announced it is working with Google to develop a location-based version of Google Maps for mobile handsets.
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