Successful Payment Systems - Global Case Studies Part 2

As you might have seen earlier this week, we published the first part of this series and talked about three global payments success stories: Octopus card system from Hong Kong, IMPS (Immediate Payment Service) from India and Suica/FeliCa from Japan. Today, we will look at three more payments success stories: one from the Scandinavian countries, one from Africa and another one from G3 Immediate Payments (Singapore).

In this two-part series, we will talk about payment systems that have been extremely successful in various parts of the world. The metrics we have taken are that of scale and impact. One or more of the following factors can be seen as common threads across the success stories:

1. Fundamentals are important: Merchant acceptance and adoption is important if you want to succeed. Can you lower the interchange fees?

2. Real-time payments, not just faster payments. A truly interconnected system; most countries are now looking for such payment systems.

3. Consumer adoption: NFC growth in the Scandinavian region and Japan took place because of the focus on consumer education, availability of compatible devices, acceptance infrastructure and integration of loyalty & reward points.

4. Collaboration: Meaningful ways of working together.

Biggest Mobile Payments Success Story: Scandinavian Countries

Denmark, Norway and Sweden have been pretty successful in payments innovation. There are some fundamental reasons for it:

Internet penetration: In Sweden, 94% of the population has access to the Internet. Across the world, the highest Internet penetration is found in Nordic countries. Sweden, Norway and Iceland are the top three countries where Internet penetration is found to be the highest.

Mobile penetration: The mobile penetration in Sweden is 150%.

Mobile internet penetration: The mobile Internet penetration in Sweden is 93%, which probably also means heavy usage of Internet and connected apps on mobile devices.

There are no adoption issues and it’s a norm to use mobiles for transit tickets, buying online or paying at stores. This trend also reflects the initial work done in educating customers.

Examples of Telecom-Led Programs: Swedish mobile phone operators Telia, Tele2 & Telenor jointly started a service in 2013 called WyWallet—their own payment system—which opened the gates for 97% of Swedish mobile phone users to pay for goods at participating businesses.

Examples of Third Party-Led Programs: Swedish mobile payment specialist, Seamless, has done a lot of good work in partnership with various banks in the region. SEQR added NFC tag-based payments in April 2013. In 2011, Seamless announced that its transaction switch does over 2.4 billion transactions per year at over 525,000 point-of-sale systems. Its transaction fees are much lower than for card payments. SEQR halves the transaction costs compared with the costs for card payments.


The m-pesa mobile service was launched in March 2007 by Safaricom Limited. This made Kenya the first country in the world to implement a successful mobile money transfer service.

- The service currently has 13 million active monthly users representing nearly 50% of all Safaricom subscribers.

- According to reports by Safaricom, transactions valued at 87% of Kenya’s GDP passed through m-pesa last year.

- Mobile - Enabling Technologies money also constitutes a very big part of Safaricom’s annual revenues which grossed $333.73 million over the last year, largely through fees.

- In May 2015, the company announced $320 million in annual profit, which has gone up by 38% from last year. While voice still remained the leading source of income for the company, m-pesa rang in a 23% growth with data seeing a 59% increase. Of the three players in the segment (Telkom Kenya, Airtel and Safaricom), only Safaricom has constantly reported profits.

G3 Immediate Payments (Singapore)

Giro 3 G3 Immediate Payments is an initiative from the Monetary Authority of Singapore. The Universal Payments G3 Gateway solution ensures that banks can offer real-time and bulk payments to their customers as a part of the G3 initiative.

It offers a complete transaction payments switching solution, including:

- Direct debit and direct credit payments processing.

- Interbank funds transfers.

- Acquiring transactions from different sources such as specialized security and payments devices.

- Host system integration (e.g. DDA host, Internet banking, settlement system, fraud and AML, etc.).

- A fully PCI DSS-compliant solution.

In 2009, some 84.3 million eGIRO transactions were processed, up from 81.6 million in 2008.

The value processed was SGD 218 billion, up from SGD 213 billion in 2008.

Success factors

- The G3 solution enables rapid message customization through configuration with no application programming required.

- The gateway can implement any payment message format and any mix of security methods.

- Real-time bulk payments.