In this part, 3 Bashir Fancy and Nick Brown discuss solutions for the Global Mobile Wallets. They will discuss ideas to avoid pitfalls and the serious threats to the existing financial systems.
In Part 1 – the Interoperability of Payments in developing countries and Part 2, The Threat of Global Mobile Wallets to Western Countries, Bashir and Nick discussed the foundation of this third session that should be an abrupt wake up call for governments and central banks throughout the Western world.
According to Bashir Fancy, there is a bit of a domino effect:
1: Mobile Money Operators will be the first to go. Individuals will switch to a faster, better (greater reach), cheaper, cooler service. Merchants will create accounts to accept these payment methods, and will gradually do less and less through Mobile Money.
1a: Merchants now have funds in Mobile Wallets, which they will push their suppliers to accept for convenience. Businesses all the way up the supply chain will start shifting to the new payment method – the ‘buyer’ always chooses the payment method.
2: Conventional Banks – Businesses will transfer some funds into Mobile Wallets as B2B transactions will be instant, most importantly for international transactions.
2a: This could cause banks to get into trouble as their reserves are depleted. There may even be some collapsing, and even result in a run on the banks.
The governments and central banks must be aware of this threat and put measures into place to avoid this outcome…………………..….MUCH More