BARCELONA, Spain (AFP) — Microsoft founder Bill Gates has agreed to help fund a massive rollout of projects enabling poor mobile phone users to transfer money using their handsets, an industry body announced Tuesday.
The GSM Association, which represents 750 mobile phone networks in the world, said a grant of 12.5 million dollars (9.8 million euros) from the Bill and Melinda Gates Foundation would help fund 20 initiatives in Asia, Africa and South America.
Money transfer via mobile phone is seen as a potential area of growth for network operators in developing countries, where millions are without access to the banking system.
"There's 1.7 billion people in the emerging markets who don't have a bank account but do have a mobile phone, so they could use their mobile phone to conduct financial transactions," explained Michael O'Hara, marketing director or the GSMA.
"The target is to reach 20 million additionnal unbanked people with the service by 2012," he added.
About 12 mobile phone banking programmes have been launched worldwide in the last few years, with about 10 million users benefiting so far.
The Gates Foundation said the grant was part of its programme to extend financial services to the poor who are often without access to a simple savings account.
"The foundation believes that setting aside small sums in a safe place allows people to guard against risks and build financial security," said spokeswoman Susan Byrnes in a statement received by AFP in Washington.
The GSMA estimates that the money transfer market on mobile phones could represent 5.0 billion dollars by 2012.