With a newly burgeoning economy and an open market for the first time in 50 years, along with rapid advances in technology, Myanmar is ripe for fintech companies to offer new products and services.
All around the world, technology is transforming people’s access to financial management services, whether for personal use or for investment and business. Fintech start-ups are now capitalising on Myanmar’s speedy development and growing use of smartphones. It’s a market ready for low cost, user friendly, accessible financial products accessible online, whether from a computer or a smartphone.
An example of a successful foray into the fintech world in Myanmar is Wave Money. This money transfer platform is jointly owned by Telenor (mobile phone service), Yoma Bank and First Myanmar Investments (FMI). It offers users an accessible, instant, convenient and secure way to send and receive money.
As with all fintech services, this solution was born out of the need to simplify banking services and make them more accessible to people. Brad Jones is the CEO of Wave Money. He says: “We saw an underlying need for money transfers that are available seven days a week, around the clock.”
How does it work?
Wave Money was launched in 2016 and allows people to transfer money either on their mobile phone or in person. There are 4000 Wave Shop agents available to help users carry out their transaction. Customers can essentially send money around the country without having to have a traditional bank account.
It’s the first company in Myanmar to be registered under the new Mobile Financial Services Regulation that gives users further security. It used to be that all financial services had to be led by a bank, until this regulation came into force. This has opened up the market even more for fintech companies to come up with solutions for the financial market in Myanmar.
Increasing financial literacy
Wave Money also signed up with the Australian Department of Foreign Affairs and Trade (DFAT) United Nations Capital Development Fund (UNCDF), in order to use gamification to improve the inclusion of women and generally increase financial literacy across the country.
As it stands, only 29 per cent of women in Myanmar have any kind of access to banks or formal financial services. Around 34 per cent have some access to financial services that aren’t formal or traditional and just seven per cent of women up to the age of 34 have a bank account at all.
It seems that the reasons behind women being financially excluded lies in the lack of information available to them, as well as a generally poor level of guidance on financial services.
How mobile phones are improving access
While many people in Myanmar don’t have much access to bank accounts and financial institutions, many do have access to a mobile phone. The amount of people owning a mobile phone in Myanmar has leapt from just under 10 per cent in 2013 to half the population in 2015 and even more in 2017.
Myanmar first allowed overseas telecom operators to enter the market in 2014, and since then data users have risen from around two per cent to 40 per cent. While it would be logical to conclude that all of these people are using their data to access banks online, according to the World Bank, the figure is closer to less than 20 per cent.
This is set to change as fintech, mobile phones and digitalisation should bring millions of Myanmar nationals into the financial system. They will have access to secure, reliable and regulated services.
Digital payments are popular
Fintech startups are already working on solutions for Myanmar’s population and as well as Wave Money shows a popular area lies in digital and electronic payments.
An example is T2P, a fintech start up from Thailand offering an e-wallet service. T2P has signed up with retail chain City Mart Holdings and they both aim to launch this service at some point in 2017 to the whole population of Myanmar (more than 53 million people).
The first product will be City Rewards, which is an online loyalty scheme that will give consumers rewards when they shop at different stores. It’ll come with an e-wallet which can be used to make payments at both online and offline shops.
A fintech startup that specialises in online payments, MywalletPlus is jointly owned by LEO Tech Services in Singapore and the MCC Group in Myanmar. The online payment platform primarily concentrates on paying utility bills, general consumer bill payments and e-commerce processing. It will be accessible by individual consumers and business in Myanmar.
Our final example is Red Dot Myanmar, which is a payment network that allows users to buy mobile phone top ups, buy products at retail partners and pay bills. The company will give retailers and merchants with tablet hardware that is managed through its central processing platform. The idea is to give a seamless consumer experience, in an easily accessible way.
And all of these are just the tip of the fintech iceberg in Myanmar.