Mobile Money for Business Development in the East African Community: A Comparative Study of Existing Platforms and Regulations, focuses on the East African Community (EAC1)

More than half a billion dollars are transferred in the region using cell phones each month through the largest of a number of commercial services on offer. The practice is burgeoning in developing regions where traditional banks and banking activities are in short supply, and most people lack access to financial services taken for granted in industrialized countries.

To ensure that mobile money services bring the desired broad benefits, especially to the poor, governments in the region need to address issues relating to telecommunications and financial regulation, the report says.

The EAC is a world leader in offering mobile money services and hosts more than one quarter of all known such systems in Africa. In a region where most people lack access to formal financial services, mobile phones offer a practical channel for obtaining them (see tables 1 and 2).

Given the pioneering role of the EAC in the field of mobile money, advances there are of particular importance. According to the GSM Association, which tracks mobile money deployments around the world, some 130 mobile money systems have been implemented since March 2012. Africa has taken the lead in mobile money implementation, with about 60 mobile money services already in place, a quarter (16) of which are in the EAC. Three of the EAC platforms now have more than 1 million active subscribers. M-Pesa, operated by Safaricom of Kenya, is currently the most popular platform. It has 15 million active customers who transfer an estimated $658 million every month. In addition, M-Pesa reports that it has over 37,000 mobile money agents, is linked with 25 banks and can be accessed via 700 automated teller machines (ATMs).

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