Nokia has announced a substantial investment in Silicon Valley service provider Obopay today, to the tune of $70 million. The amount gives Nokia a minority stake in the company, which specializes in payments via mobile phones.
Teppo Paavola, head of corporate business development at Nokia, will also join Obopay's board.
Obopay says it will use the cash injection to "extend its product suite and enhance its global presence," according to the release.
"This investment is a landmark in the evolution of mobile payments. It underscores the global potential of mobile money by providing convenient access to money anytime, anywhere. Given Nokia's position as the leader in mobile communications, we could not have asked for a better investor," commented Obopay CEO Carol Realini.
Obopay operates in the U.S. and India and allows users to send money to any text message-enabled cell phone. The sender can fund their account with cash or by linking up their credit card or current account; the receiver can sign up for an Obopay account or have the money directly transferred to their bank account.
Obopay charges 25 cents to send any amount up to $1,000. (It costs nothing to receive.)
The company is likely banking on emerging markets, where current infrastructure isn't enough and where mobile growth is likely to boom in coming years.
Just last year, Gartner predicted that the number of people making payments using their mobile phones globally is set to soar from 32.9 million in 2008 to 103.9 million in 2011.