Today, Kenya has more cellphone subscriptions than adult citizens and more than 80 per cent of those with a cell also use “mobile money” (or “M-Pesa” which is very different from “mobile banking” as Michael Joseph — the former Safaricom chief executive officer and the man behind that revolution — can explain passionately!).
Internet access is also increasing rapidly, even though many are complaining about poor service by some operators. Within the next two years, Kenya could become one of the most connected and modern economies in the developing world, and a unique case among the world’s poorer countries that have an average annual income of below US$1,000 per capita.
While the telecom revolution is not unique to Kenya, mobile money is.
There are approximately 60 million mobile money users in the world, which means that almost one in three is a Kenyan. Half of all mobile money transactions are taking place in Kenya where annual transfers are now around US$10 billion.
The emerging social and economic impact has been remarkable. Businesses can operate more effectively: shop-owners don’t need to carry a lot of cash or to stand in long queues at banks to transfer money to suppliers.
Urban dwellers no longer need to make overnight trips to their rural homes to pay their children’s school fees (or give money to relatives).
Women have been empowered because their husbands have a harder time taking their money away.
Even macro economic policy has become easier because the Central Bank has a better handle on the money in circulation as mobile money helped to move cash from the mattresses to the market.
The success of mobile money in Kenya should be a source of national pride: It gives the country a global profile, which is only matched by the successes of its long-distance runners.
But Kenya’s global leadership in this area is also puzzling. Even Hillary Clinton wondered why this “brilliant innovation” is not available in the USA.
How come mobile money has not yet taken off in other countries, especially those where money transfers from urban to rural areas are enormous even by Kenyan standards?
If it is so beneficial to customers and operators, why have they not sought to replicate Kenya’s success, given that replication is so much easier than innovation?
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