More than $1.7 trillion passed through Kenyan mobile phones in 2013, thanks to a partnership between financial institutions and network providers that’s been sweeping the country since 2007.
“The reported growth of mobile money in Kenya is hardly a surprise,” said Bob Collymore, chief executive officer of Safaricom, Kenya’s largest mobile provider, to HumanIPO on Dec. 10.
It was the first company to adapt M-Pesa, a service that allows users to deposit, withdraw and transfer funds through any mobile phone.
It caught on with users so quickly that Kenyan bankers lobbied their government to audit the service in 2008, hoping to stop the service. In the end, however, the audit only proved its usefulness.
By November of that year, the service had more than a million users. In 2013 there were more than 17 million registered customers, according to the company’s website.
M-Pesa recently announced that revenues grew by 29.5 percent in 2013, and are set to grow even faster as mobile exposure grows.
And the service does more than just make companies more money, though that helps.
According to The Economist, a study of rural Kenyan households that use the system found that incomes increased 5 percent to 30 percent. Plus, the availability of fast, reliable cash is spawning a series of startups.
A recent survey showed that the number of adults in Kenya using mobile money services jumped to 62 percent in 2013, to 5.4 million people, up from just 28 percent of the population four years ago.
According to the World Bank, more than 2.5 billion adults, most of them in developing nations, do not have access to a formal bank account.
The same report shows that nearly 16 percent of adults in sub-Saharan Africa and 31 percent of people with a formal bank account have used mobile phones to make transactions, according to a recent World Bank report.
And if mobile connections continue to grow as expected, this will certainly be a market to watch.
Kathleen is a money junior reporter at International Business Times....