Money transfer texts 'to surge'

Money transfer through text messages is to become increasingly popular in the coming years, a report has claimed.

The study, published by industry analyst firm Gartner yesterday (November 18th), suggested that SMS money transfers have many advantages, including flexibility, convenience and low cost.

In particular, the speed at which funds can be transferred is appealing to customers, especially those in emerging markets.

As a result, several million people across the world have signed up to the service within the first year of its launch, the report said.

"However, challenges do exist in both regulatory and operational risks. Because of the fast growth of mobile money transfer, regulators in many markets are piling in to investigate the impact on consumer costs, security, fraud and money laundering," Gartner warned.

"On the operational side, market conditions vary, as do the local resources of service providers, so providers need different market strategies when entering a new territory."

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By Linsey Summers