Mobile Money Transfer Services In East Africa

People around the world, especially in East Africa, are paying their school fees, healthcare and utility bills using mobile phones today. Businesses use mobile money phones to pay their staff and suppliers. People who have never entered a bank are using mobile services to send or receive remittances and to save their money.

The EAC is a world leader in offering mobile money services and hosts more than one quarter of all known such systems in Africa.

With mobile money – the use of cell phones for money transfers and payments – increasingly popular in East Africa, a new report from the United Nations trade agency calls for region-wide rules to coordinate and harmonize regulations.

The report, Mobile Money for Business Development in the East African Community: A Comparative Study of Existing Platforms and Regulations  | Download PDF , focuses on the East African Community (EAC).

MOBILE MONEY TRANSFERS KENYA

Kenya is the regional and gloabl leader when it comes to money transfer as a result of the revoluonary product:M-Pesa.  

67% of the Kenyan  population received transfers via mobile money in 2011. 

M-Pesa

M-Pesa  is a mobile-phone based money transfer and microfinancing service for Safaricom and Vodacom, the largest mobile network operators in Kenya and Tanzania. Currently the most developed mobile payment system in the world, M-Pesa allows users with a national ID card or passport to deposit, withdraw, and transfer money easily with a mobile device.

YU Cash

YU (Essar) introduced YuCash a mobile phone money transfer service similar to Mpesa to offer money transfer service to its subscribers.

Currently, this company is working to grow its subscriber base.


Orange Money

Airtel Money Kenya

 Airtel Money Kenya, is a  comprehensive service enabling customers to access their money faster and more conveniently.  This product is reshaping the future of banking in Africa, the service is available to over 100 million people in Kenya, Tanzania and Uganda.

MOBILE MONEY TRANSFERS UGANDA

Close to 10 million Ugandans use mobile money compared to about four million bank accounts. The maximum account balance allowed on mobile money is sh5m and the maximum daily transaction is sh4m.
Total mobile money transactions grew from sh3.8trillion to sh11.7trillion in 2012.

According to Bank of Uganda, daily mobile money transactions have hit Shs50 billion up from Shs30 billion.

MTN Mobile Money Transfers Uganda

MTN MobileMoney is a service that enables people to send and receive money anywhere in Uganda using their phones. The service operates by using an agent who is the intermediary between the parties in the transaction. 

Msente Mobile Money Transfer Uganda

Uganda Telecom M-Sente is a mobile wallet for a subscriber that offers a fast, secure and painless method for money transfer and bill payment.

MOBILE MONEY TRANSFERS TANZANIA

For the month of September 2012 alone, the value of mobile money transactions in Tanzania was about 14 percent of total deposits held by commercial banks. Truly, there is a mobile money revolution in Tanzania.

Tigo Pesa

Tigo Pesa is a product of Tigo, Tanzania's fastest growing mobile phone network. This company is a subsidiary of the Vodafone Group, and is the leading mobile network operator in Tanzania with a 37% market share. Vodacom also launched M-Pesa in Kenya.

Airtel Money Tanzania

Airtel money Tanzania is the service that allows Tanzanians to manage their money directly from their mobile phone wherever they are at  time. 

Zantel Z-Pesa

Zantel Z-pesa allows customers to send and receive money and purchase air time. Also, customers are able to pay their utility bills and other services to subscribed business and companies.

MOBILE MONEY TRANSFERS RWANDA

The country has over 1.2 million registered users of mobile money (11.5% of the population) with nearly 800,000 transactions alone in October 2012.  However, it is still small compared to the markets in other East African countries, particularly Kenya, where 67% of the population received transfers via mobile money in 2011. - See more at: http://www.theigc.org/publications/working-paper/regulation-mobile-money-rwanda#sthash.lcupqSgE.dpuf

 This country has over 1.2 million registered users of mobile money (11.5% of the population) with nearly 800,000 transactions alone in October 2012.  However, it is still small compared to the markets in other East African countries, particularly Kenya. 

MTN mobile money transfer Rwanda

Airtel Mobile Money Transfer Rwanda

Mobile money has become part of people's everyday lives because they don't need to carry cash. Even those who were formally unbanked have mobile money accounts with a service provider of their choice because it's cheap.

East African Mobile Money Transfer Services Facilitate Remintances From Abroad

East Africans Abroad Send Home Billions of Dollars Every Year Via Mobile Phones

Because  of international money transfer services of most mobile phone companies in East Africa it is possible for such monies to reach relatives at home within the shortest time possible.

Soaring cash remittances from abroad have presented mobile phone companies with an opportunity to bolster commission incomes and deposits.

Most of East African remittances come from the United States of America, United Kingdom, Germany and Denmark.

Most web based payment gateways for East Africans eventually deliver money from individuals living abroad to those at home via mobile phone trasfer services

There are  many online gateways that facilitate the transfer of cash from Paypal to the mobile phones of recipients across the world.

Relatives in rural areas find mobile money to be very convient

Those who cannot access banks easily or not very educated will prefer to get money from their relatives abroad via mobile money.

Facts about remittances in East Africa

• A World Bank study showed that remittances have overtaken horticulture and tourism to become East Africa's  highest foreign income earners.

• 14 per cent of  adult East Africans receive remittances an average of seven times a year. 

•  Africa is emerging as a key source of remittances for East Africans competing with traditional lead markets North America and Europe, and eclipsing the Middle East.

• An estimated Sh38 billion was sent by Kenyans living and working in different parts of Africa last year.

• Neighbouring Uganda and Tanzania accounted for nine and seven per cent of the total inflows respectively.

• South Africa (four per cent), Botswana (one per cent), Sudan (one per cent) and Rwanda (one per cent) were the other top African sources of remittances.

• East African professionals on the continent are mostly working in the medical, IT and finance fields.

• Thirty five per cent of the recipients of remittances invest it in small business, 33 per cent use it to pay for university education for a family member while eight percent use it to build houses or buy land for housing.

Market For Mobile Phones In East Africa

One of the fastest growing mobile telephone markets in the world is East Africa.

Many foreign companies  are already eying the East African market to supply mobile handsets due to tremendous oppoutunities in this region of the world.

Rising demand for mobile handsets being met by Chinese firms

Chinese firms have been quick to meet the rising demand for mobile handsets in Kenya, Uganda, Tanzania, Burundi and Rwanda . These companies they have appointed agents and distributors for their products in East African countries.

East Africa is a price sensitive market

Most East Africans prefer to buy cheap goods instead of products made by multi-national firms based in the west. Because of the cost issue, mobile handsets originating from Asia are selling like hotcakes in East Africa.

East African mobile phone market has a huge potential of growth

With a penetration rate of a paltry 30 per cent and merely 37.6 million mobile subscribers, this region has a huge potential of growth in relation to the market for mobile phones.

3.5 % of East African GDP is as a result of mobile phone trade and trade of mobile related services

The mobile industry contributes a total of $56billion to Africa’s economy, representing 3.5per cent of Gross Domestic Product (GDP) in the continent. The number of mobile connections in eastern Africa is forecast to reach 800 million by the end of 2013. This will end up overtaking Latin America to become the second largest mobile market in the world, after Asia.

Mobile phone price wars in East Africa

Between 2010 and 2011 east African telecoms operators reduced prices by an average of 18 per cent so as to beat competition and subsequently stay relevant in the market. Price wars are very  common across the East African sub-continent.

Drivers of long term growth in this industry in East Africa

•  Transparent ICT regulation in East Africa- Laws are being amended to favor all players in the industry instead of merely meeting the interests of government and inconveniencing market players.
• Liberalized markets- The age of monopolies. Market entry barriers  are slowly being elimnated in favor of free trade.
• Patnerships between mobile service providers and East African governments- By working in partnership, mobile operators and East African governments can continue the remarkable growth story of the African mobile industry. The benefits that mobile services have already brought to hundreds of millions of Africans can be extended to those who have yet to connect – by so doing, the African continent can continue to bring not only communication services, but also improved financial services, healthcare and education to its people and drive an increase in the economic wealth and development.

Mobile Service Providers East Africa

East African region has one of the highest numbers of mobile phone subscribers in the world. As a result, many of the big time telecos found in the west have been attracted to the region. UK's Vodafone operates in Kenya under the name Safaricom.

MTN that has an Africa wide presence is present in Uganda as MTN Uganda.

Kenya

Mobile penetration rate of Kenya stands at 74%. There are a total of 29.2 million mobile phone subscribers in this country. Regulator in Kenya is Communication Commission of Kenya(CCK).

The regulator is Communication Commission of Kenya (CCK)

There are four mobile phone operators in this country namely:

 1.Orange- Owned by Telekom Kenya- 3 million subscribers

 2.Safaricom- Owned by Vodafone UK- 19.1 million subscribers

3.Airtel- Owned By Bharti Airtel India- 4.5 million subscribers

4.YU- Owned by Essar Group- 2.6 million subscribers


Rwanda

 Penetration in this country is one of the lowest because the country is in the process of recovering from civil strife

Mobile networks

1.) MTN- 2.8 million

2.)Tigo- 0.8 million subscribers

3.)Bharti Airtel

4.)Rwanda Tel

Uganda

The population of Uganda  is over 30 million and only a paltry 30% of the population are using mobile phones.

1.)MTN

2.)Airtel

3.) UT Mobile

4.) Orange Uganda

5.) Warid

6.) Essar

Tanzania

 Tanzania has about 10 telecom operators. Penetration stands at 48% making it the second highest in Eastern Africa after Kenya.

Top three networks are:

1.) Vodacom

2.) Tigo

3.) Airtel

Kenya is the most lcurative market in the telecoms industry in East Africa with penetration standing at over 70%.

Cheap Wi-Fi on the Go: Courtesy of Google East Africa

Wazi Wi-Fi initiativeis a brainchild of Google in partnership with local East African ISP providers such as Wananchi online.  The purpose of this project is to increase Internet penetration in East Africa and to facilitate maximum utilization of the region’s bandwidth capacity. What started as a project based in Nairobi and Mombasa, is gaining national and regional importance following expression of interest by major stakeholders to join the initiative.

Browsing on the go in Kenya is now a reality

Many establishments have been grafted into this project. There are a number of Nairobi restaurants that are part and parcel of the Wazi Wi-Fi initiative. Patrons of such restaurants will have the privilege to browse from the comfort of a hotel.

National and regional rollout underway

 This project is set to cover every major city in East Africa. This will be done by Google partnering with as many regional internet providers as possible. There are many telecoms companies that have expressed willingness to be part of this initiative.

The roll out started in the latter months of 2012 in Nairobi and Mombasa. As at October 2013, more than 400 hotspots have been deployed in over 200 locations.

Local payment options supported

Kenyan subscribers can pay via the local M-Pesa platform. Also, it is possible to pay using debit and credit cards. Charges are as low as Ksh 50 per day. Those who want to test the service will be given 10 free minutes on a particular day.

How the whole initiative is being carried out

This arrangement brings a number of ISPs under an umbrella called Wazi Wi-Fi. Subscribers can access the internet from the platform of an ISP that is available from a particular location. It is possible for subscribers to benefit from various wireless distributors from a single channel. All that is needed is a single login to Wazi Wi-Fi platform and someone will access the internet at the speed of light.

Increasing east Africa internet penetration

Personnel of Google East Africa never run short of ideas in relation to increasing internet penetration in Kenya and other EA countries. Of late, the talk that has been emanating from western media is that Google plans to connect 6 billion people found in rural East Africa and other rural regions of the world, to the internet using blimps and balloons. Initiatives like Wazi Wi-Fi are only suitable in places where there are urban broadband networks.  High altitude platforms like balloons have to be used to facilitate internet connectivity in rural areas.

Kenya’s broadband seriously underutilized

 National internet capacity of Kenya exceeds 8400G. Presently, only 6 percent of this is being utilized. Actually, Kenya does not need 4G when the 3G is currently being underutilized. Wazi Wi-Fi project will facilitate maximum utility of the region’s broadband capacity.

Google is playing a pivotal role in the region when it comes to increasing internet penetration. Wazi Wi-Fi is a first in East Africa. It is meant to offer urban dwellers with faster, cheaper internet.

Google to use BLIMPS and Balloons to Increase East Africa’s Internet Penetration

Why use Blimps and balloons

Infrastructural challenges of sub-Saharan Africa makes it almost impossible to have wired networks that cover most parts of a country. Some regions are simply inaccessible because of geographical challenges.  Therefore the only option is to use high altitude platforms like Blimps and balloons to facilitate seamless transmission.

Wireless networks are the ultimate solution when it comes to increasing internet penetration of East Africa and other regions of the world within the shortest time possible.

An Array of Wireless Technologies Is Required

There is no silver bullet. No single technology can addressed the issue of internet connectivity in East Africa, Southern Africa and underdeveloped regions of Asia.

Google Engineers are presently brainstorming a number of technologies. So far, the most viable options have been found to be harnessing the power of radio frequencies and white spaces. These two can unlock a bright new future for over 6 billion people living in rural areas across the developing world.

Permission from a government is required so that Google can start utilizing the network of a country for the sake of facilitating internet connections. In East Africa, the necessary institutions in Kenya are already involved in high level talks with the officials of this multinational corporation related to increasing wireless penetration.

Why Google is Very Keen with White Space Technology

White space technology makes it possible to transmit signals over geographical barriers like hills, walls and trees. However, the curvature of the earth will still be an issue but there are many documented techniques that can be used to improve reception in rare cases when matters like curvature will be an issue.

A Google white space network will involve an online database, a base station and a blimp or a balloon.  The station will relay messages to the blimp platform with details such as protocol and GPS co-ordinates. Subsequently, feedback will be sent back indicating the frequency ranges that are available.

White Space Technology Has Already Been Tested In South Africa

Since Microsoft trials that were undertaken in South Africa yielded positive results, the case for East Africa will not involve starting from scratch. Also, launching of wireless networks in this region of Africa will borrow heavily from experiments that were carried out in South Africa that involved running databases using White Space radios.

Kenya, Uganda and Tanzania Have Unused Radio Frequencies

Google is trying to negotiate with these governments on usage of these frequencies. These bands are presently not being used for TV and radio transmission because of historic anomalies. For a long time they have been off limits to internet providers. However, with a small change in government regulation, Google can be allowed to tap into unused frequencies for the sake of increasing internet penetration.

In a world that is increasingly being transformed by virtual platforms, Africa should not be left behind. With investments from top dollar companies like Google, East Africans may soon be able to catch up with fast paced technologies of the west. A lot of deliberations between different stakeholders are presently being undertaken about how to increase internet penetration in developing and underdeveloped countries.

Google to Connect 1 Billion Africans and Asians to the Internet

Google Executives Have Entered Into Talks with Kenyan and South African Governments

Plans are underway to bring people in far flung places in Africa and Asia to the internet. The power of cellular networks will be harnessed for the purpose of achieving this lofty goal. It is very evident that most of the areas of the planet that lack internet access are found in Africa and Asia.

Spreading the Internet While Spreading Google

The strategy of Google is to make many people to access the internet via platforms owned by Google. It is all about making many people to directly or indirectly use Google Services. Already, the term Google is synonymous with the internet as a result of the ubiquitous Google search.

 

 

 

  Image Credit, Creative Commons

Why Sub-Saharan Market Matters to Google

 Once a big chunk of East Africa and other parts of Africa are accessing the internet via Google platform, it will be easy to sell to those people Google products. It is all about increasing market share in a day and age where Africa is going to play an increasing role in the global marketplace.  East Africa is the next big thing in the world of tech as evidenced by the current development of Africa Silicon Savannah that is simply the African Silicon Valley.

A bigger East African audience loyal to Google means more eyeballs seeing Google advertisements and even clicking on such directly resulting to revenue maximization on the side of this company.  Also, products affiliated to Google such as cheap android phones can be sold to people in such areas.

Google Is Already Monetizing East African Traffic

Google already has a strategy in place for monetizing East African traffic. Big time companies in Kenya, Uganda and Tanzania are already using Ad words as one of the primary marketing strategies. Therefore it makes more sense for Google to increase the number of Africans who use the internet.

How the Whole Affair Will Be Done

Google is planning to use wireless spectrums that have been reserved for television broadcasts. To do so they require permission from the host countries. Already, Kenyan and South African government officials have been contacted. Construction of these cellular networks will speed up internet penetration in East Africa. 

After the whole affair is over, it will be possible for hundreds of millions of East Africans to access the internet at faster speeds. Similar Google initiatives in other parts of the world include Google Fiber high speed internet in the United States of America.

Google to Provide Critical Infrastructure

Respective governments are required to fund this project to a certain extent. However, processors and base stations to be used in building networks are to be provided by Google. There is a likelihood of high altitude platforms such as balloons and blimps being used to facilitate the broadcasting of cellular signals to a wider circumference.

Google East Africa initiatives have yielded many positive results in the past. This multibillion internet company is set to launch the widest internet network in Africa. This project will benefit millions of Africans who are not connected to the internet and also widen the reach of Google’s products.