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Credit card giant MasterCard recently released a mobile payments readiness index for the world. If you haven’t seen it you might be shocked as to what countries are the leading the charge. A country's overall score is calculated by aggregating six different aspects of readiness including Mobile Commerce Clusters, Consumer Readiness, Environment, Financial Services, Infrastructure, and Regulation. These segments are then averaged to discern a countries mobile payments readiness score.
I wasn’t shocked, however, I was surprised when Singapore was heralded as the most ready country in the entire world for mobile payments. The shocker was the number two country in the world for mobile payments; it’s our neighbors to the north: Canada. It seems Canada’s regulatory environment, unified banking system, mobile network operators and consumers' willingness are converging in what may be a perfect storm for mobile financial services.
Let’s explore these aspects individually to have a better understanding of what’s happened and why our often forgotten neighbor is about to become a worldwide leader in mobile money.
In May 2012, the banking and credit union system of Canada announced an effort to create a set of voluntary, secure, open guidelines for the development of mobile payments at point-of-sale. According to the Canadian Bankers Association, a party to the development of the guidelines, the rules, called the Mobile Reference Model, are purely voluntary and meant to be a blueprint for how mobile payment services can be offered to Canadians. Included in the guidelines are specification for exchanging information between banks and brands, mobile providers and merchants. The blueprint came about as a result of the Canadian government’s Task Force for the Payments System Review in 2011 and was developed by a cooperative group of Canadian financial institutions in order to develop a functioning mobile financial marketplace. The intention was to create a roadmap that would benefit the entire market.
Unless you were trapped in a cave you no doubt heard the news about Canadian mobile network operator Rogers filing applications to become a bank last September. This news, coupled with regulatory changes is resulting in a groundswell and Canadian citizens are reportedly clamoring for mobile financial services. Their increasing confidence in the economic rebound and zest to be a leader in the marketplace has developed into a flurry of activity from both the government and the private sector related to mobile money.
After registering for a press pass to the recent FinovateFall event, I was delightfully surprised to receive an invitation to a private reception which was to be held by the Canadian Consulate in New York City. The event was organized around and focused on highlighting several of the Canadian companies in the financial services market. Several of the companies being introduced at the reception were also pitching at Finovate. The reception was held at the Canadian Consulate of New York’s private residence on Park Avenue. The event was quite intimate and highly attended by movers and shakers from the mobile and financial ecosystem.
After the initial mixing and mingling the Consul General, John F. Prado spoke briefly to the group and the message provided by the Consul was clear: the Canadian government is greatly interested in providing an environment for financial innovators to grow and prosper in this new regulatory environment.
Keep your eyes peeled and watch for more forward movement in this marketplace, for there is no doot aboot it, Canada is out to be a market leader in mobile financial services in Generation-M!