How subsaharan africa bred the global leader in mobile money by farhaz. Cashdominant communities are a challenge for companies or businesses who want to send or receive money. Kenya is home to mobile money transfer invention with the success of mpesa being a case study for the rest of world. Mpesa, a mobile money transfer service launched in 2007 in kenya by telecommunications company safaricom, allowed people to send money via mobile. The first section is written by nick hughes, a vodafone executive who started this project in 2003 and now heads a mobile payments team with the task of growing the business. Safaricoms main competitor, zain, launched zap in early 2009 as a competitive response to mpesa. Emoney for enhancing mdgs at bottom of the pyramid. Enabling mobile money transfer the central bank of kenyas. A case study of the critical early adopters role in.
The following case study discusses the period of development of the mpesa mobile payment product from concept inception in 2005 to. Customers can also use mpesa to transfer money in and out of accounts at 14 banks. Mmoney channel distribution case tanzania vodacom tanzania mpesa public disclosure authorized. E40,o16,o33 abstract mpesa is a mobile phone based money transfer system in kenya which grew at a blistering pace following its inception in 2007. The lack of competition enabled safaricom to capture the market and lead the way. The impact of mpesa in kenya isaac mbiti and david n. A case of mpesa in kilosa, morogoro by saskia hoope a dissertation submitted in partialfulfilment of the requirement for the award of the. Jun 14, 2019 specifically, while mpesa is credited with facilitating a rise in client incomes and savin gs, increases in levels of client debt are completely ignored in the study. Mpesa in april 2008 and describes how those tactics have evolved since to improve delivery and.
Safaricoms services include mobile and fixed voice, sms, data, internet and mpesa, a mobile phonebased money transfer service. The specific objectives of the study were to understand the impact of market penetration, market development, product development and diversification strategies on mpesas performance as measured by market share and revenue. This archive has the case studies prepared by research award winners in each country filed by year. Having worked with these systems in kenya and uganda, have a couple of questions about their uptake and future. Within five years of its launch, mpesa had 15 million customers, equivalent to 37.
The aim of the study was to establish the various challenges that safaricom has experienced in pursuit of the innovation strategy through introduction of mpesa. Many rural kenyans are dependent on agricultural yields for income, which can result in variable. In 2019, world bank analyst abebi eke had a difficult assignment. The specific objectives of the study were to understand the impact of market penetration, market development, product development and diversification strategies on mpesas.
Each school that wins the gttp research award in its country also prepares a case study for use in gttp classrooms around the world. The study considers the outstanding challenges experienced by users, possible solutions and future trends. Mobile banking for the unbanked harvard business school. Mpesa provides both banked and unbanked individuals with access to money transactions at affordable. M pesa is the first banking app for mobile phones to be produced in the developing world.
Groups revolutionary mobile money transfer platform. Case study enabling mobile money transfer the central bank. Safaricom integrates the global goals into their corporate strategy by working both from top down and bottom up approaches within their company. The curious case of mpesas miraculous poverty reduction. I thought that your perspective on why the service is failing to pick up in other countries was very interesting. This study targeted mpesa service agents in a sample of urban areas in kenya, including kakamega, kisumu, machakos, maragua, meru, mombasa, muranga, nakuru, thika and voi. Mpesa users are more likely to receive help when hit by bad luck. Mmoney channel distribution case kenya safaricom m.
Vodafone mpesa, oxigen wallet, paytm, mobikwik and idea. Dec 08, 2016 a study finds the mobilemoney service m pesa has lifted 194,000, or 2 percent, of kenyan households out of poverty, having greater impact on femaleheaded households and helping 185,000 women shift from farming to business occupations. Institutional entrepreneurship and social innovation at. The most successful example of mobile money is mpesa. At jpal, she is scientific director for africa, cochair for the agriculture sector and of the agricultural technology adoption initiative and chair of the digital identification and finance initiative her research focuses on the adoption and impacts of. Two authors have written this case study, each taking up one part of the story. The kenyan telecoms operator, whose m pesa platform has already brought mobile money transfer services to millions of east africans, 2 is tackling the sustainable development goals sdgs in a big way. Mpesa has more than 21,000 agents managed by several hundred anms and million registered customers more than half the adult population.
Transforming millions of lives telecom circle the economic impact of mobile phones is a well talked about fact but the role of mobile phones in remittances and money circulation can be far greater. Kenya national hospital insurance fund nhif premium collection for the informal sector updated. Jul 09, 2015 m pesa, the mobile payments brand of safaricom, and now the largest financial service business across africa, features in peter fisks new book gamechangers which explores the next generation of. Early research suggests that this is also the case in tanzania, where a. Firstly, mobile money is regularly used as a solution to a lot of financial inclusion. The mpesa mobile payment system was launched in kenya in 2007. In addition, using a mobile money system mpesa allows customers to buy units of credit for their lighting system at any time. Kenya and tanzania the two countries may be east african neighbours but they are different places, geographically, economically. Cash remains the primary method for consumertobusiness c2b and businesstoconsumer b2c transactions in many emerging markets, since access to traditional banking facilities remains low. The key features on their strategy has included exploring untapped. Case study enabling mobile money transfer the central bank of.
The first section is written by nick hughes, a vodafone executive who started this. For example, at mpesas launch in south africa, roughly 70% of the populations already had bank accounts, and a lot of alternative mobile payment services already existed. The purpose of this study was to establish the growth strategies that safaricom limited company had implemented for mpesa service and the impact on its performance. Key events in the development of mpesa afi case study enabling mobile money transfer 01 the following case study discusses the period of development of the mpesa mobile payment product from concept inception in 2005 to december 2008. Mpesa is a smsbased system that enables users to deposit, send, and withdraw funds using their mobile phone. Cashdominant communities are a challenge for companies or businesses who want to. Financial inclusion in kenya case harvard business. M pesa in april 2008 and describes how those tactics have evolved since to improve delivery and penetration of the system in tanzania. I wrote my post on m pesa as well, but specifically on its impact on kenya and safaricom.
Low mpesa was the first mobile money transfer service to be launched in kenya. The case study of m pesa helps to demonstrate how the use of technologies can help overcome infrastructural and operational limitations often faced when delivering social protection packages to vulnerable population in developing countries is concerned. There have been some notable successes, such as vodafone safaricoms mpesa in kenya. Fundingedit in march 2015, indian industrialist ratan tata made a personal investment in the firm. The purpose of the study was to examine how mpesa innovation has influenced competitive advantage of safaricom. Tavneet suri is an associate professor of applied economics at the mit sloan school of management. At jpal, she is scientific director for africa, cochair for the agriculture sector and of the agricultural technology adoption initiative and chair of the digital identification and finance initiative. Please create an account or sign in to gain access to this material permission to reprint each purchase of this product entitles the buyer to one digital file and use. Mpesa thrived on the underdevelopment of traditional banking infrastructure to grow. The study sought to find out the mpesa customers perception of the service and the challenges they encounter in using the service. The study was coauthored by tavneet suri of the mit sloan school of management. Mpesa, a mobile banking system in kenya, will be the focus of this paper. Mpesa is a mobile money service that was officially launched in kenya, in march 2007, by. Since the launch of m pesa in 2007, nearly 100 services like it developed around the.
The research sought to answer the following questions. T his presents a wholly incomplete picture of the role that mpesa pla ys in the lives of kenyas poor. Geetha nagarajan is research director at the iris center, serving as economist and monitoring and evaluation specialist. Similarly, bitcoin stands a chance to thrive in kenya with majority of kenyans turning to the online market to buy and sell goods and services as. The central bank of kenyas treatment of mpesa the kenyan mpesa mobile telephone banking.
Its experiences offer important lessons in how to link sustainability with core business aims. Subsaharan africa kenya vodafone and safaricom kenya. Mmoney channel distribution case tanzania vodacom tanzania. Mpesa offers clients a mobile wallet with the functionality to transfer money and pay bills. Today, as it faces new challenges, it has 30 million users in 10 countries and three continents. Kpmg true value case study safaricom limited about safaricom safaricom limited is the largest mobile operator in the kenyan market. A new case written by kash rangan is a lesson in understanding the real need of customers. As the primary provider of health insurance in kenya its mandate is. The study considers the outstanding challenges experienced.
Mobile money for the unbanked turning cellphones into 24hour tellers in kenya two authors have written this case study, each taking up one part of the story. This two part case study would attempt to explain the reasons behind mpesas success part i and how i. Click on the country name to download the pdf of the winning case study. The research design was a case study that was descriptive in nature using primarily interviews and observations. The study took on a descriptive study design on a target population comprising of 50 mpesa outlets in kitengela and athi river townships and a sample size of five mpesa. Scribd is the worlds largest social reading and publishing site. Oct 14, 2011 m pesa case study friday, october 14, 2011. In april 2008, vodacom tanzania went live with the second east african implementation of vodafone. June 9, 2014 program overview the kenya national hospital insurance fund nhif is the oldest government insurance scheme in africa. This case study describes the developments and success of m pesa. Over the last 10 years, availability of mobile phones has increased dramatically.
The case study consists of engaging in parallel with the senior leadership team and their team of sustainability champions to develop a framework for integrating the sdgs into corporate strategy. The kenyan telecoms operator, whose mpesa platform has already brought mobile money transfer services to millions of east africans, 2 is tackling the sustainable development. We examine how mpesa is used as well as its economic. Mpesa in tanzania had 280,000 users and 1,000 agents rasmussen 2009. Paytm priya saxena, department of manegement studies, hr,tmimt. Mmoney channel distribution case kenya safaricom mpesa. The present case study portrays the leading company in the epayment domain. A study finds the mobilemoney service mpesa has lifted 194,000, or 2 percent, of kenyan households out of poverty, having greater impact on femaleheaded households and helping 185,000 women shift from farming to business occupations. The topic of trust was chosen for analysis because we are dealing with economic transactions and the exchange of emoney via the mpesa application.
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