SR article


The way people do business in Kenya has changed in the last decade,  a very important reason for this change is the introduction of Mobile Phones as a way to trade money.  With this new way of payment, delivering cash has never  been so easy. People can make payments without the trouble of traveling long distances to pay in cash and the rates aren’t as high as you would get when you want to make use of a bank. Besides that there are probably more people with a mobile phone than with bank accounts.

The new way of payment isn’t only used by individuals, but also by micro-businesses. They need to be registered and licensed by Kenyan law, but most of them aren’t . A few who are and those who have a bank account have the problem that they have to leave their businesses unattended to make a transaction in a bank.

In March 2007, Safaricom launched a project called M-PESA. They tried to provide a service for all Kenyan people which can be used to pay for goods, sending money to relatives and friends (often form urban areas to rural areas), withdrawing cash and topping up airtime accounts. Proprietors and micro-businesses benefited hugely from this project, because they had access to more customers and new services. Besides that they were able to save some money. It is logical that M-PESA was a huge hit and by 31st December of 2012 they had five million active users, within a total population of 40 million people.

M-PESA also provides more safety for the people that are using it, because they can make use of balances and they can store some money. Therefore they don’t need to take cash with them and they are harder to rob (Mbogo, 2010). The system is also very safe, because everything is monitored and the M-PESA agents are recruited by Safaricom after due-diligence process and they are put under specific training. They are also regularly monitored and re-trained and they are visited twice a month.





Mbogo, M. (2010). The Impact of Mobile Payments on the Success and Growth of Micro-Business: The Case of M-Pesa in Kenya. Journal Of Language, Technology & Entrepreneurship In Africa2(1).