NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Monday, July 20, 2015

Kenya’s mobile money banking service market will gain a competitor with today’s launch of Equitel, a technology platform that ties Equity Bank with mobile phone service provider Airtel to provide the user with a thin SIM technology-based mobile banking and telecommunications service.

Equitel, introduced through Equity Bank’s subsidiary FinServe Africa Limited, is designed to facilitate mobile access to financial services. It also represents a direct competitor to the likes of Safaricom’s M-Pesa money transfer service.

The service works off thin SIM technology. This is a thin (0.1 mm) film that is placed directly on a subscriber’s SIM card which then enables dual-SIM phone functionality.

Equity’s thin SIM technology has experienced delays in getting to market because of legal wrangling and issues with regulators. Plans to roll-out the technology have also been met with resistance from mobile operator, Safaricom.

Safaricom issued a complaint to the Communications Authority (CA) arguing that risks such as PIN theft and denial of service could occur with the thin SIMs.

John Staley, chief officer for finance, innovation and technology at Equity Bank, has said, “We needed to look for a technology where we could give affordable secure mobile banking to our customers and the only way you can do that is by one controlling the channel yourself because USSD is a very cheap channel. If you can control the USSD channel then you don’t have to charge your customers, they can do banking for free from a telecommunications point of view.”