The world is a much smaller place than it has ever been before. Faster travels and easier communications mean that one can live or work anywhere in the world and stay connected.
The proliferation of mobile wallets (read our article here) means airtime top-ups have taken a backseat; according to a GSMA report, outgoing transactions within the mobile money ecosystem total US$13.6 billion in December 2018, but just 4.5% of that figure went to airtime top-ups. However, US$600 million in a month is not an insignificant amount. This figure shows that there is a niche market for airtime top-ups dominated by foreign workers.
Among developing countries, airtime top-up is attractive, both to consumers and service providers, because of its simplicity and high margins, respectively. For example, airtime transfer accounted for less than 5% of Tranglo’s processing value for 2018, yet it remains a major profit contributor to Tranglo.
Airtime transfer retains a unique position among those unfamiliar with technology, such as migrants or the unbanked, because they are accustomed to the process of “topping up” their mobile credits. As this category of consumers takes up the largest slice of the market, service providers remain keen to develop or continue products that sustain their needs.
Perhaps the most important reason why airtime credit is still a relevant discussion within the mobile payment landscape is its continued recognition as a “currency”. Often used to pay bills and shop for groceries, it is, in every sense of the word, money in countries where fintech regulations are fragmented or absent altogether, and where there is a lack of infrastructure to support other forms of mobile payments like e-wallets.
Reliable mobile airtime services, such as those powered by Tranglo, often cover a vast array of operators and countries, usually with competitive pricing. Even though the global airtime market is relatively saturated, its current trajectory may be enough to see it retain its relevance for at least a few more years.