Mobile Money Not As Useful As Expected For Banking Poorer, Rural Africans
Kenya’s banks came together this month to launch PesaLink, a new platform that will be integrated into all banks in the country, allowing users to seamlessly send money from one bank to another.
The move signifies major new competition for Safaricom’s M-Pesa and other mobile money services, which launched initially to streamline the process of sending money.
This is something Safaricom in particular has become used to. Chief executive officer (CEO) Bob Collymore admitted as long ago as December 2015 that competitor and regulatory pressures were forcing the company to redefine and innovate.
Kenya has seen new mobile virtual network operators licensed in recent years to shake up the near-monopoly some critics say M-Pesa has enjoyed, while Safaricom in 2014 was forced to open up its agency network to rivals.
Regulatory pressures aside, M-Pesa in Kenya and elsewhere is feeling the heat more than ever, at least in part because of its own limitations.
No one solution for all
The success of M-Pesa, and mobile money in general, is such that it must be considered Africa’s major technological success story. Mobile money transactions in sub-Saharan Africa totaled US$656 million in 2014, and are projected to more than double over the next four years.