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Cash is king, or so the saying goes, and this is especially true in Myanmar. Traditional financial institutions don’t have a strong hold on the market as an estimated 74% of Myanmar’s citizens do not have a bank account and fintech apps such as e-wallets are a relatively novel concept.
Long known to be Asia’s last frontier market, the country entered the tech race fairly late in the game compared to most of its Southeast Asian neighbors. It had its start in 2012, when Myanmar’s state telecom carrier and postal service announced its plans to privatize the local telecommunications industry.
“Myanmar went from no-G to suddenly 3G and 4G, and these multinational telecommunication companies, Ooredoo and Telenor entered the market in 2014,” says James Faulkner, head of marketing at Myanmar-based mobile wallet startup, Onepay.
In 2011, Myanmar had a mobile penetration rate of 2% and only 0.23% of its population had access to the internet. Just three years after the telecommunication industry’s privatization, the country was named the fastest growing mobile market in the world, behind only India and China. Now, it boasts a mobile penetration rate of 126% and its internet penetration has shot up to 41%.
Myanmar’s growing tech-savvy population, coupled with a lack of access to formal financial services, puts the country in a unique position to leapfrog past traditional banking systems and straight into mobile payments.
According to Onepay’s Faulkner, recent innovations in the remittance sector is an example of how Myanmar’s entire financial industry could go digital. “Remittance was a big issue in the past [because of the lack of access to banking services], but some banks have begun moving from purely over-the-counter transactions to digitalizing the process by using fintech solutions like e-wallets,” he explains.
By leveraging technology, e-wallets can serve the unbanked population in Myanmar. Faulkner adds that while this leads to more people having access to financial services, companies providing digital payment services benefit as well because they’re able to grow their client base – a win-win situation that leads to a stronger local economy.
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