Nokia runs all the way to the bank

So what happens when you lose your phone?

Or you drop it and it breaks?

In short, you're not going to keep much money on your phone. And that will make it easier for someone to switch to a traditional bank or another carrier. And so this market won't have the same barriers to entry that Nokia might wish it had - it should be a fluid market.

@Mike S -- What happens when you lose your phone?

The same thing as when you lose your credit card. The money isn't in the phone, it's in your account. You get a new phone (or another second-hand phone) and have full access to your money. It's a lot safer than cash. People in the West typically take a couple of days to report a lost card, they take less than an hour to report a lost phone.

In developing countries, where people live on tiny amounts of money and much of it comes in one chunk at harvest time there is a real issue with security. They often keep the money in jars and give jars to friends and family for safekeeping so that if they get burgled they don't lose everything.

In Kenya people will pay money into M-PESA before going on a long bus journey and then withdraw it when they arrive.

There are few traditional banks for these people two switch to. Although they do well out of mobile money. Before M-PESA Kenya had 4 million bank accounts. Today they have more than 6 million. The growth has come from the education about financial services.

Hawala?

From Wikipedia: In the most basic variant of the hawala system, money is transferred via a network of hawala brokers, or hawaladars. A customer approaches a hawala broker in one city and gives a sum of money to be transferred to a recipient in another, usually foreign, city. The hawala broker calls another hawala broker in the recipient's city, gives disposition instructions of the funds (usually minus a small commission), and promises to settle the debt at a later date.