Seeking Fertile Grounds for Mobile Money
This paper highlights the importance of environmental dynamics in the uptake of mobile money.
The potential of mobile phones to revolutionize access to financial services in developing countries is exemplified by the success of the M-Pesa mobile money service in Kenya. But the apparent difficulty of replicating M-Pesa's success suggests that some contexts may be more receptive to such an innovation than others. M-Pesa's success was due to Safaricom's:
- Ability to tap into a large, domestic remittance market;
- Ease of access, reliability, affordability, and flexibility;
- Ability to afford the scale and efficiencies of corporate capitalism, with the flexibility and contextual appropriateness of informal markets.
The paper lists factors that determine the potential for scale of the money market opportunity in a given market. They include latent demand, quality of existing alternative services, regulatory environment, quality of existing retail infrastructure, and mobile market landscape. All these factors aligned to ensure the success of mobile money deployment in Kenya. Finally, the paper suggests that while Kenya shares many characteristics with other countries, the combination of Kenyan characteristics may turn out to be fairly unique.
