LatinFinance - November/December 2014 - 32

TRANSACTION
BANKING
MOBILE
MONEY

Widespread cellphone ownership in Latin America is bringing
banks new clients - and new competitors. By Andre Puglie

Going digital

32 L ATINFINA NCE.COM - November/December 2014

for Bancolombia's Ahorro a la Mano product, and users can use their accounts to add
and transfer funds, pay bills, and receive
third-party payments. Using a 30-minute
disposable identification code, they have
access to the ATM network of Colombia's
largest privately-owned bank. In addition,
the institution has set up a network of correspondent agencies in underserved parts of
the country, where Ahorro a la Mano customers can make transactions in person.
Expanding Bancolombia's reach to a wider proportion of the population, including

©REUTERS

anks in Latin America
are investing heavily in cellphone technology, as lives turn increasingly digital, and
mobile. From Tijuana to Ushuaia, banks
are increasingly encouraging customers to
tap phones to check balances, pay bills and
transfer funds.
In some ways, what keeps mobile banking from being quite as universal as cellphone use itself, however, is that millions
across the continent do not have accounts
in the first place. That is where some banks
and cellphone firms are spotting an opportunity, as a trend
that has already gained
ground in Africa takes
off in Latin America
too.
Two large Colombia
banks, for example
- Bancolombia and
Davivienda - have
asked the question:
What if, instead of just
expanding our services
to mobile, we use that
platform to draw in
new customers? What
if owning a smartphone - or even just
a good, old-fashioned cellphone - actually
gave you a bank account?
A SIM card is all that's needed to sign up

HANDY: Widespread ownership of mobile
phones, including basic devices, is increasing
opportunity for cellphone banking across
Latin America

the poor, and those in remote areas without
access to bank branches, is critical for the
institution's future, says chief executive
Carlos Raúl Yepes. Not long ago, a soldier
serving in a remote area of Colombia and
making $100 a month might need to spend
up to $40 of his wage simply sending the
money back to his family, Yepes explains.
With Ahorro a la Mano, that has changed.
"The soldier in the rainforest, with our
account [and] without maintenance fees,
easily distributes his money at home,"
Yepes says. "It doesn't cost him a single
peso."
Davivienda's service, dubbed Daviplata,
largely follows the same concept as Ahorro
a la Mano. Daviplata users can also use their
CARLOS RAÚL YEPES, BANCOLOMBIA

"THE SOLDIER IN THE
RAINFOREST, WITH
OUR ACCOUNT [AND]
WITHOUT
MAINTENANCE FEES,
EASILY DISTRIBUTES
HIS MONEY AT HOME"
phones to make in-store purchases: much
in the way a traditional bank customer
would use a debit card. Both Ahorro a la
Mano and Daviplata work with the country's four main phone operators, Claro,
Movistar, Tigo and UFF.
It is not just Colombian banks, however.
BBVA is investing heavily in internet and
mobile retail banking across its network,
and not just for smartphones. A digital money transfer scheme is also core to a strategy
of growing in rural areas and in the informal
sector at Itaú's Paraguay unit, according to
Continued on page 34

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LatinFinance - November/December 2014

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