The Bill and Melinda Gates Foundation has announced support for a new program partnered with the GSM Association that aims to bring affordable and reliable mobile banking to less developed nations. The Bill and Melinda Gates foundation has announced $12.5 million to kick-start the Mobile Money for the Unbanked (MMU) Program.

There are over 1 billion people in emerging markets today who don’t have a bank account but do have a mobile phone,” said Rob Conway, CEO and Member of the Board of the GSMA.

Partners include various carriers, banks, governments and other microfinance institutions. It is fair to say these companies will generate significant amounts of profits from the millions of people who will be charged complete transactions. Of course, the entire program will also only help the people of the less developed nations. Rob Conway went on to say, “This represents a huge opportunity and mobile operators are perfectly placed to bring mobile financial services to this largely untapped consumer base,”

People will also be able to complete transactions with merchants by easily passing their credit/debt cards in front their mobile phones.

Based on exploratory research, it is believed the mobile money for the unbanked market has the potential to become a $5 billion market within the next three years.
The program will initially be focused in Africa, Asia and Latin America.

The Gates foundation more recently announced $90 million to boost incomes of small farmers in Africa.

Similar services already exist, such as from PayPal Mobile, which allows you to send money from your mobile phone. Of course, PayPal Mobile does not compare to the new initiatives in terms of scope.