I am sure that you have all seen the increasing number of Western Union (WU) announcements that are showing up on our Google news alerts, one of the recent announcements was my own dear colleagues in Canada (EnStream/Zoompass) who launched international remittance using the WU rails for cash-out and intl. settlement. As a self proclaimed pioneer, which only means that I have been living on canned beans longer than most in this space, I cant help but feel that the service providers like EnStream are actually missing the mark completely! It would probably have been cheaper to just set up a WU agent shop in Chinatown-Toronto.
Part of the things that fascinated me about the convergence between mobile and financial services was the ability to disrupt the existing ecosystems who has no incentive to change, but is interested at worst in stagnation and at best some sort of managed democratization of their services. Instead EnStream should have spent a little bit of time identifying, like companies such as m-via has done, their target corridor and then focus on a viable cash-out network in the inbound market. That way EnStream could actually have lowered fees for the end consumer, while building a brand, revenue and network.
By integrating and getting "certified" against WU nothing has moved and in fact I am sure there are all kinds of ways that WU can tie down their newfound cash-in agents, making it hard for future disintermediation. I think that service providers needs to understand that press releases with no revenue is not valuable, but a distraction (similar to how Visa's VMT service is a poorly packaged punchline, why even bother?)
I know I am harping on EnStream in this post, but I am not really intending to, EnStream in this post just symbolizes the complacency that the service providers are beginning to show.
It concerns me because this industry was and is being built on disruption and ecosystem displacement. I hope that in 2011 the service providers will dig deep one more time and get back to what the intent was from the onset.
Happy new year for remittance disruption - (come on guys, its not that tough)
Good post and I agree. The whole point of building mobile money platforms is to transform the current high cost base and inefficencies that exist in MMT. It does seem strange that the industry seems to be doing everything it can to support the very business models that thrive on inefficiency as it is more profitable. Need to look at what else is going on in the new web media / internet models to see what can be achieved with courage.
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