First launched in Kenya, the mobile payments service has transformed banking across much of Africa
It now has 51 million users in eight African nations plus Afghanistan
Economic and social impact has been immense
Service continuing to expand and evolve — M-Pesa is now a full services financial provider
Sunday 6 March marked the 15th anniversary of the official launch of the phenomenally successful M-Pesa, Africa’s first mobile payments service. The mobile handset-based money transfer, payments and micro-financing service, designed initially for the pan-African market, began public service on 6 March, 2007 via Vodafone and Kenya’s leading mobile operator Safaricom. They initially offered limited money transfer facilities on 2G ‘feature phones’ – which is indeed what they were at the time.
Success came quickly and since then M-Pesa has expanded its services to Tanzania, Mozambique, the Democratic Republic of Congo, Lesotho, Ghana, Egypt, South Africa and Afghanistan. M-Pesa came about as a public/private sector initiative thanks to initial funding provided by the UK government’s Department for International Development and by Vodafone itself.
The ‘M’ in ‘M-Pesa’ stands for ‘mobile and the word ‘pesa’ means ‘money in Swahili. The service, which operates as branchless banking, allows mobile phone users to deposit, withdraw and transfer money as well as to pay for goods and services and access credit and savings accounts. What’s more, customers can also deposit and withdraw money from a wide network of more than 600,000 agents including retail shops and companies recalling mobile airtime.
Users pay variable charges depending on whether or not they are registered with M-Pesa and on a separate scale according to the value of each cash transaction. These costs have risen over the years M-Pesa has been in commercial service and are not as minimal as once they were. Nonetheless, M-Pesa is Africa’s most popular and ubiquitous financial technology platform and remains a major driver of financial inclusion, with more than 51 million customers across countries where, previously, the rural and urban poor were excluded from financial networks and the benefits of e-commerce and the digital society.
Indeed, M-Pesa is credited with having tripled the number of people who are now classified as part of the ‘formal banking system’ in the parts of Africa where it operates and has massively improved living standards in remote and rural areas. Whilst doing so it has greatly improved the lot of women by empowering them, for the […]
