Mobile money is one of the biggest success stories of the past decade. There are now more than 1.2 billion mobile money accounts worldwide1, enabling people to use their mobile phones to transfer money easily and access low-cost and convenient financial services.
Ericsson is a hugely influential player in this space, and it has significant plans in place to financially empower even more individuals across the world.
Initially deployed in 2011, the Ericsson Wallet Platform is now used by more than 20 mobile operators worldwide to serve nearly 300 million registered users. Supported by F5’s traffic management and security solutions, the platform is currently handling around 50 million transactions every day. Around $1 billion transactions are processed daily.
“Our work in this field is significant. We are aiming to bring financial inclusion and empowerment to previously unconnected people—and to do so on an unprecedented scale,” says Christian Jartelius, Head of M-Commerce MOAI at Ericsson.
Throughout its 145-year history, Ericsson has always focused on delivering a sustainable and connected future. The Mobile Wallet Platform epitomizes that vision, making the act of sending money as easy as sending a text, and receiving it as simple as getting a phone call.
The challenge at the outset was to make the platform as robust as possible, incorporating a range of country-specific solutions compliant with complex financial and data sovereignty regulations.
“We needed to understand the financial landscape and the regulations in all the countries we wanted to operate in. Then we had to build a product that is compliant but also flexible enough to enable constant innovation and service enhancements,” says Jartelius. “You can't just copy and paste from one country to another and be completely successful. You need to consider a lot of variables.”
Security was another top priority, particularly as the digital financial services sector continues to attract increasingly skilled and determined cybercriminals.
“Security is critical to protect people's livelihoods. We are handling real money produced by countries’ central banks. That’s why we need to ensure we’re always using state-of-the-art security measures and solutions,” Jartelius emphasizes.
In many jurisdictions, regulations stipulate that personal data is not allowed to leave the country, presenting a further challenge for multinational companies like Ericsson.
There are also commercial considerations. To ensure that Ericsson could leverage its existing distribution channels and customer relationships, the wallet platform needed to support services related to both telecoms and finance.
For example, consumers should be able to use a wallet account to top up their mobile prepaid credit or make peer-to-peer transfers to other individuals and businesses. Furthermore, the platform had to deliver commission to agents helping consumers convert cash into electronic monetary value and vice versa.
Essentially, Ericsson required an open architecture that combines secure, high-performance telco-grade and financial-grade capabilities on a single platform. This included a need to support specific financial requirements such as Know Your Customer (KYC) identity verification, Anti-Money Laundering and Counter Financing of Terrorism (AML/CTF), and sanctions screening.
To bring its ambitions to life, Ericsson built an end-to-end mobile wallet solution for people to easily conduct banking transactions directly from their mobile device, including storing, transferring, and withdrawing money. They can also pay merchants and utility providers, as well as access financial services such as savings and loans.
Another key feature is the wallet’s integration with Ericsson’s existing prepaid solutions, which means it can cross-bundle telco services and financial services in real-time. To enable customers to quicky scale up during peak demand, Ericsson is using F5 traffic management solutions to balance loads across its architecture. When it launched in 2011, Ericsson installed physical machines from F5 for this purpose, but it has since upgraded these to virtual editions.
Ericsson has also gone to great lengths to ensure its platform is highly secure, with specialized F5 solutions providing advanced protection against DDoS attacks and other specific threats.
“Our security architecture is extremely strict,” says Jartelius. “We cannot compromise on this point, and we always need to stay ahead of the curve.”
This is where F5 and Ericsson’s decade-plus collaboration really stands out to benefit customers in a multitude of ways.
“The flexibility and functionality that F5 brings is really valued as we support our customers in their demanding market objectives,” Jartelius enthuses. “F5 has been with us from the start, and we have a very good relationship. For example, the joint team often comes to us with solutions that we both benefit from in the long term. Our collaboration is constantly evolving and getting stronger.”
To help the platform expand even further, F5 is supplying its solutions on a commercial basis to closely align with Ericsson’s business model. This gives customers the headroom to scale mobile money services in line with market demands. It also ensures that the mobile operators’ costs are predictable.
Demand for the Ericsson Wallet Platform continues to grow. Case in point, Ericsson estimates that nearly half of all consumers in Sub-Saharan Africa alone are now using mobile financial services—a more-than three-fold increase in the past six years. As there are four times as many mobile subscriptions as bank accounts, Ericsson and its customers are clearly bringing about greater financial inclusion.
As usage of the wallet platform soars, Ericsson and its telco customers are also accumulating transactional data that can be used to derive credit scores. The aim is to offer individuals personalized loans with minimal risk. As ever, a robust and secure platform will be pivotal to the end-user proposition.
“Our traditional Communication Service Provider customers now have something really valuable that they can leverage and use to provide solutions of this nature, which are faster than those from traditional banks,” Jartelius explains. “The business opportunity is immense. A CEO of one of our telco customers recently told me that this is already one of their future core businesses.”