Mobile cash market worth $7.9 billion by 2012

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Phone companies are vying for the mobile-money business of nearly 2 billion people who lack access to banks, which could add up to $7.9 billion in sales for operators by 2012, according to the GSM Association (GSMA).

GSMA forecasts that some 364 million unbanked handset owners will enroll in services that allow money transfers and bill payment by 2012, and predicts that the extent of mobile money will increase as it becomes available in more countries and customers become more familiar with it.

Juniper Research analyst Howard Wilcox notes that people with mobile phones often far outnumber those with bank accounts in emerging markets, “and therefore the mobile phone has in many cases become a much more trusted brand than the bank.”

GSMA estimates that money-transfer services for unbanked handset owners could generate $5 billion of transaction fees and text-message linked revenue by 2012, while indirect revenue will likely bring in an additional $2.9 billion.