Innovative mobile money services like mpesa in kenya and tanzania have grown into major payments services that move billions of dollars annually. The lives of many kenyans are being transformed by an innovative mobile phone money transfer service. Taxation on mobile phonebased transactions and on airtime has been introduced in kenya and is spreading to other african countries. Possible welfare impacts of lower cost of transfers. By june of 2014, safaricom claimed 26 million mpesa subscribers for mobile money transfers. Mobile money the next wave of growth 3 mobile money the next wave of growth is the latest in a series of ey reports on developments and opportunities in the market for mobile payments and related services. Mpesa as a payments and money transfer platform was developed jointly by safaricom, a telco company, and the commercial bank of africa. The cheapest ways to send money to kenya finder india. Prior to mpesa, mobile phone customers had engaged in trading prepaid airtime. Mpesa, kenyas mobile money initiative, turns 10 cnet. Kenyas been schooling the world on mobile money for 10 years. Other sections discuss building and incentivising agent networks, and there will be an accompanying article on the regulation of agent networks.
But that was before mpesa became appreciated as a popular money transfer technology. For a transfer to take place a recipient needs a mobile money account and the sender requires the recipients mobile. Mobile money spurs savings, thus increasing healthcare access, write melvin obadha, andrew seal and tim colbourn. It uses crosssectional data collected from 379 multistage randomly selected households in three provinces of kenya. This paper focuses specifically on kenya, a country that is often considered to be home to the worlds most developed mobile money system. Pdf the effect of mobile money on saving and money transfer. How mobile money has changed lives in kenya gates foundation. Research done in 2009 noted that such inclusion had risen by about six per cent in terms of. The mpesa international money transfer imt service lets people in the uk send money directly to the mobile phones of people who have an account with the firm in kenya. Send money to kenya using our secure online transfer options and help to support your family and friends.
Kenya begins mobile money transfer across networks youtube. Instant money transfer to mobile wallets and bank accounts in africa. Pdf impact of mobile phonebased money transfer services in. Kenya sets world first with money transfers by mobile. Like the exchange rate, youre advised of any fees when you get the quote for the transfer. However, the effect of mobile money on financial deepening in kenya remains unknown with no studies have been carried out to evaluate the contribution of various variables to financial deepening in kenya. The case presents the structure safaricom established in order to develop a mobile money transfer service in kenya. The effect of mobile money on saving and money transfer practices for lowincome earners in kenya. Pdf factors influencing the adoption of mobile money transfer. The service started in kenya as mpesa introduced by safaricom and has since been replicated in other parts of the world especially in developing countries. There are approximately 60 million mobile money users in the world, which means that almost one in three is a kenyan. The previous reports in this series, in 2009 and 2011, focused mainly on emerging technologies and the various types.
Mobile money mpayments are increasingly being adopted by organisations as a new way of doing business in the 21st century. During the study period, the amount of money transacted through the mobile money transfers increased steadily from 0. Managing a mobile money agent network a handbook for mobile network operators this is the third and final section of a handbook on agent networks developed by the gsma. With access to healthcare still a major problem in subsaharan africa because of costs, the continent could benefit from using services such as mobile money and savings. The kenyan mpesa mobile telephone banking service was first conceived by safaricom in 2005. Antimoney laundering laws and regulations kenya covers issues including criminal enforcement, regulatory and administrative enforcement and requirements for financial institutions and other designated businesses in 31 jurisdictions. Benefits of mobile money transfer trickle down to rural folk before 2008, analysts lamented that kenya was performing poorly in financial inclusion. Its low costs, fast speed and no need of having a bank account. Cameroon, the democratic republic of the congo, haiti, kenya, lesotho, nigeria, papua new.
How mobile money transfer is shaping kenyas economy. Fees vary depending on how you want to send the funds. Mobile banking and mobile money adoption for financial. Kenyas equitel is now the second largest mobile money service in terms of transaction values. Mpesa and the rise of the global mobile money market. Brief protecting consumers, providers, and the system.
Low levels of financial inclusion represent a barrier to socioeconomic development in developing countries. It was aimed atexamining the factors influencing the adoption of mobile money transfer strategy in telecommunication industry in kenya. Details written by muthoki mumo business daily africa. Transfer time 90% of worldremit mobile money transfers are received in less than 10 minutes. An ethical perspective donatus mathenge githui corresponding author school of business, kimathi university college of technology, p o box 65710100, nyeri kenya email. Two billion people remain unbanked, without access to safe, secure and affordable financial services. Well the definite answers will be out in the next one month. Equity is simplicity itself, there is never a problem, always great service and i would recommend them. Safaricom, one of the largest telcos, took the lead. Kenya now dominates mobile money transfers across the globe. Majority in countries surveyed have access to mobile phones.
Challenges for the somali money transfer sector rift. For example, cash transfers are priced differently compared to mobile payments. Comparison of mobile money mtransfer costs in kenya 39. Publication of the legal notice crowned the long wait for a formal legal framework for mobile money in a country where there are over 26. Protecting consumers, providers, and the system the rapid growth of mobile financial services mfs is arguably the single most significant contributor to. As the use of mobile phones for money transfer is relatively recent, there are. Article pdf available in international journal of current research. Pdf regulations concerning digital payment systems, including mobile money, are being discussed in latin american countries at the moment. One fifth of kenyas mobile money transactions are now. The use of cell phones to transfer money in modern africa. Kenyan banks launch pesalink, their own mobile money. Mobile money transfer allows people to send money using short message service sms. Nearly 121,000 agents covered the country selling and servicing a public hungry for the ease of mobile transactions.
Residents transfer money using the mpesa banking service at a store in nairobi, kenya, on sunday, april 14, 20. Making it cheaper and easier to send money may seem like a small innovation, but mpesa has had a profound impact on the ability of kenyan households to. During the last few years, the use of mpayments as a new payment channel has resulted in an increase in the volume of. The gsma mobile money programme is working with mobile operators and industry stakeholders to create a robust mobile money ecosystem, which will increase the relevancy and utility of these services, and ensure their sustainability. There is particular concern about the impact on somali money transfer sector. On 15 august the cabinet secretary for the national treasury issued a legal notice1 officially giving life to the national payment systems regulations, 2014. The study sought to determine the effect of mobile money transfer services on financial deepening in kenya. Enabling mobile money transfer the central bank of kenyas. In essence, mpesa is a persontoperson p2p money transfer system that allows individuals to make payments and send remittances.
The benefits of mobile money in kenya more a kenyan passenger uses a mobile phone and a bebapay card, a mobile phonebased money transfer service that allows transit passengers to pay their bus. Most people probably dont think of kenya as an innovation and technology hub, but in 2007 it became the launching pad for mpesa, a transformative mobile phonebased platform for money transfer. The countrys successful mobile banking and payments initiative, mpesa, turns 10, while the rest of. These writers have based their argument on the success of mpesa, the dominant mobile money in kenya and east africa. Mpesa m for mobile, pesa is swahili for money is a mobile phonebased money transfer service, payments and microfinancing service, launched in 2007 by vodafone group plc and safaricom, the largest mobile network operator in kenya. A mobile money transfer is a fast, easy and secure transaction whereby a sender sends money from their bank, creditdebit card or own mobile money account to another mobile money account. Mpesa launches uktokenya mobile money transfer service. Remits advantage is that it is the fastest, cheapest, and safest way for africas diaspora to send money home. Pesalink is different from the major mobile money platforms in kenya in that it will not be housed within a sim card application such as safaricoms mpesa or equity banks equitel.
Top 10 kenya money transfers send money to kenya from uk. Case study enabling mobile money transfer the central bank. If one were to paint a picture of the kenya that most of the world is familiar with, it would likely include the wildlife landscapes like the maasai mara national reserve, where youre guaranteed to see some of the big five, including lions, leopards, and elephants. Remit is a remittance transfer service built by eversend ltd that offers realtime debit or credit card to mobile money transfers from all over the world to registered mobilemoney users in uganda, kenya and rwanda. Kenya sets world first with money transfers by mobile this article is more than years old. There are limited alternatives for channeling funds to somalia, in the absence of an established banking system and there is concern about the possible impact on livelihoods of any major disruptions to remittance mechanisms. The free account mpesa is offered by safaricom kenya, a leading mobile phone service operator and is a technological breakthrough say. How possible, convenient, fast and affordable would it be to transfer money from one mobile money platform to another.
Survey, 150 mobile money systems in 72 countries have been deployed, and another 109 projects are in planning phases penicaud 20. The effect of mobile money transfer services on financial. Keep equity direct with you anytime, anywhere using our free mobile and web app. Enabling mobile money policies in kenya fostering a. Subscribe to our youtube channel for more great videos. Mobile money operators typically leverage an agent network to. Financial inclusion enabler itut technology watch report may 20 globally, more than 2. Some of the african countries where mobile money transfers are famous include. While the telecom revolution is not unique to kenya, mobile money is. If you need to send your money to kenya you can compare the rates, services, and fees of these providers and find the one for you. Equity money transfer to africa send money to kenya. Remit send money to uganda kenya rwanda mobile money. Transfer time 90% of bank transfers with worldremit are completed the same day. This was revealed after data from the communications authority of kenya analysed data relating to mobile money transfers from mpesa, airtel money.
Use your mastercard or visa to send money to kenya, uganda, tanzania, rwanda east africa to any mobile or bank account. In 2007 kenya became the first country to launch mobile money transfer service through a cell phone service provider safaricom. Kenya is considered the hub for mobile money with the innovation of mobile money transfer credited to kenya. Concerns in mfs regulation in kenya include interoperability in view of a. Each provider will charge a fee for your money transfer to kenya. It has since expanded to tanzania, mozambique, drc, lesotho, ghana, egypt, afghanistan, south africa, india, romania, and albania. They have, however, forgotten to draw a parallel to mobile technology adoption as well as mobile money adoption in the west african region.
This system is called mpesa, a combination of mobile and. Kenyan banks launch pesalink, their own mobile money transfer platform. Money transfer service wows kenya noel mwakugu bbc news, nairobi clients are flocking to the new service. Practitioners insight mpesa a success story of digital. Working paper guidelines on international remittances. The resulting guidelines on international remittances through mobile money referred to as guidelines throughout the document illustrate how the mobile money industry and its partners are collaborating to ensure that international transfers conducted through mobile money are facilitated in a safe and secure manner.
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