Nokia closes Mobile Money business Globaly

This is a surprising news – Nokia has decided to shut down its mobile money business – Nokia Money. It is quite surprising that Nokia has taken this decision. Looking at the market currently, mobile money is expected to be a big business in coming years. Infact, more than one telecom provider has jumped the gun, most recently being Airtel.

Launched with much fan-fare in February of 2010 – Nokia Money was expected to consolidate its market position in India. Nokia Money was based on Obopay’s platform and was initially targeted at growth markets like India and was designed to work in partnership with multiple network operators and banks, involving distributors and merchants.

What is more surprising is the fact that Nokia Money went Pan-India just couple of months back. Gary Singh, GM of Nokia Mobile Payment Services had mentioned during the launch that..

“There is a need for alternate financial payment instruments in India and mobile offers the perfect mass platform to deliver these. Transaction costs through banking correspondents is almost a tenth cheaper and for customers using mobile for money transactions the cost are even lower”. (source)

And now suddenly news of Nokia Money closure comes in. According to Reuters, the Nokia company spokesperson has said..

"The mobile financial services business is not core to Nokia so we plan to exit the business”

How come this sudden change in strategy?

Yes, Nokia has been realigning its strategy and is moving out of non-core areas. But, Nokia Money was getting good traction in India with over 2 lakh subscribers already using its services. This announcement is also a big blow to Obopay, the platform on which Nokia Money was being offered.

From consumers point of view, it should not be much of problem as they have more than one service provider who are offering mobile money services to them.

What do you think of this decision by Nokia?