International companies, inspired by the success of Safaricom’s M-pesa, are rushing to create cash solutions targeted at millions of Africa’s unbanked
As the mobile phone sector stands poised to pose its stiffest
challenge yet to the financial sector in the coming months, the
country’s profile as the world’s innovation hub in the mobile finances
market is on the rise.
Kenya is to mobile money
solutions what Silicon Valley was to software in the last decade and
companies are taking advantage of that to use the country as a testing
ground for solutions they hope will translate into global success.
Analysts
attribute the fact that at least five international companies— ranging
from financial institutions to mobile phone manufacturers and service
providers — are putting the final touches to what they hope will be
financial masterpieces to rival M-pesa —Safaricom’s mobile money
transfer solution that shifted the balance of power in the financial
world with its launch nearly three years ago.
Within that short span, the country has emerged as the seat of
innovation as other players try to replicate the success of M-pesa in
capturing and retaining subscribers for Safaricom, the country’s
leading mobile services provider and most profitable company in East
Africa.
Countries such as Kenya, the Philippines,
Tanzania, Uganda and Sudan form the world’s mobile money hotspots, with
states like Ethiopia and Somalia following closely behind, said Norman
Frankel, the founder and CEO of Mi-Pay, a Sudanese mobile money
transfer company while speaking to industry journal MMT Explained.
“If
you look at the World Bank Remittance Factbook and identify countries
with a low percentage of the population who emigrate but with strong
urban migration trends, you’ll see these countries embracing mobile
money faster,” he said.
Of these, Kenya plays host to
the greatest number of mobile money products, and with over eight
million users of the services, has the distinction of recruiting the
highest number of subscribers to the mobile money phenomenon.
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