M-pesa For the Rural Poor

M-pesa For the Rural Poor

M-Pesa may not be a interesting subject for the rich and developed countries but it is highly popular as a micro financing service from the mobile service providers, Vodacom and Safaricom in African countries especially in Kenya, Tanzania, Uganda and Ghana. The number of M-pesa customers in Kenya itself is more than 18 million this shows the popularity of M-pesa.

Heavy processing fees, service charges and interest rates levied by the commercial banks makes their service unavailable for the poor African population so M-pesa was the necessity of those millions. M-pesa was developed by the Kenyans with the support of Department of International Development, a UK agency in 2003. This has truly benefited rural population of Kenya, Tanzania, Uganda and Ghana who doesn’t even have bank accounts and this scales up to around 79% of entire African population.


Establishment of M-pesa was easy due to the fact that there are more than 500 million mobile phone users in African countries and in Uganda alone there are more than 10 million mobile phone users.

How M-pesa Works?

It is so easy that anyone can register to the M-pesa network through an M pesa agent and they are available in every nook and corner of these African countries. Soon after the registration the service provider would send an updated menu to the phone. Then the customer has to give money to the M-pesa agent and he will load it. It is just like storing money in your mobile and sending it as a text to the recipient’s phone and he can take the money from his local M-pesa hub. Most of the banking and telecom transactions could be done using this service. Just few clicks on the mobile and the money is send to any part of the country that too within no time. The popularity is such that 11% of Kenya’s GDP is transferred through M-pesa alone. You can even withdraw money from ATM without an ATM card. M-pesa is for

• Cashless transactions
• Money Transfer
• Bill Payments
• Airtime Purchase
• Bank Transactions

M-pesa in Various Countries

MobileMoney in Uganda

MobileMoney was launched by MTN Uganda in 2009 has grown to have 600000 customers within that year. Their marketing techniques helped them to acquire 1.9 million customers till 2013. MTN Uganda covers 80% of the country and this made MobileMoney available everywhere. Additionally, Grameen Foundation which is a micro financing agency in Uganda even lends smart phones on lease and this obviously add into the number of mobile phone users.

M-pesa in South Africa

Owing to the strict banking regulations in South Africa , M-pesa is not functioning well even it launched in 2010 with the partnership of NetBank and Vodacom. Despite the people without a bank account exceed 13 million, M-pesa has not got popularity yet so the partners are redesigning the product and planning new marketing strategies.

M-pesa Afghanistan

Amidst the Taliban threats M-pesa has gained such popularity that the police department started distributing salaries through this service. Launched in 2008 by Vodafone and partner company Roshan, the primary mobile provider, M-pesa even put an end the ghost police servants who were looting the salary of government officers. Finding this service every efficient, Afgan government is making use of this service for other financial transactions

M-paisa India

Indian version of M-pesa, M-Paisa was launched in 2011 by Vodafone and HDFC, has not started as a full-fledged service yet. In 2013 Vodafone partnered with ICICI also.


Conclusion

M-pesa seem to have great scope in poor countries where rural population is high. In Africa where electricity consumption is just 4% of the global electricity consumption, advance banking techniques like mobile banking, or online banking including having own PC is a distant dream for laymen.