Bri Colorful

How fast do your dollars move?

Posted on: November 10, 2010

Get this: people in Kenya — yes that is a third world country — are depositing, withdrawing, and transferring their money with their cell phones. They can also pay bills and purchase airtime.  The service is called M-PESA, M standing for mobile (that’s right folks, cell phones) and PESA meaning money in Swahili. The wikipedia article about  M-PESA, says customers receive the service “from a network of agents that includes airtime resellers and retail outlets acting as banking agents. M-PESA is operated by Safaricom, a Mobile network operator (MNO), which is not classed as a deposit-taking institution (such as a bank). Therefore, M-PESA may not be advertised as a banking service.”  Anyone else’s jaw on the floor? Check out this commercial about M-PESA. (the first 58 seconds are just footage of Kenya and pretty music, so skip ahead to get the information.)

CGAP’s article on M-PESA says that “since its introduction in March of 2007, the M-PESA application has had great success all over Kenya. There are currently over 2.3 million registered users. Over 18 Billion Ksh had been moved through the system, via person-to-person transfers.”

It all follows the idea of mobile payment. Instead of using cash, check, or cards to pay, places in Asia and Europe (and the developing world for micropayments) are rapidly adopting the method of paying with a mobile phone. The transfer of money is a lot smoother and quicker. Just think: you get out of your car that you spent the last 8 minutes (if you’re like me) trying to parallel park downtown and the last thing you want to do is fish around for coins to put in the parking meter. Enter mobile payment! At the risk of sounding like a commercial, it really makes the point of transaction a lot quicker and easier (which might be a risk for many of us, LOL).

And according to this article, as of next year, Nokia is going to do something similar by including NFC [Near Field Communication] chips in their phones. You know the contactless card idea? Instead of swiping your credit card, some places have machines where you wave your card in front of a machine and it detects a chip that allows you to pay that way.  Now they’ll put a similar chip in your phone. It’s not mobile banking like accessing your bank account from your phone. It’s like your phone becoming your wallet. So, do you feel like you just stepped into a science fiction novel?

 

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3 Responses to "How fast do your dollars move?"

I saw something on television about this earlier this year. It is amazing. You may be interested to know that we use the cell, or “mobile” as they say here, to pay for our street parking all the time. Now, if they’d just let us use if for bus and tube – that WOULD be amazing!

[…] the sublime. When we studied economics I chose to focus on something discussed in class about the current micro-finance situation in Kenya.  In Fear Based Fiction I compared the sci-fi B movies of the ’50s to popular sci-fi movies […]

[…] them. Since language is so closely tied to culture, I am sure that it follows the same pattern. Culture evolves over time. I know Tavia; I’m sorry. I understand that when you shake the rug of tradition […]

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