M-Pesa's rollercoaster ride

9 Jun 2011

M-Pesa, the world-famous mobile payment system, has effectively become a type of credit card for poor communities in East Africa. The payment system has had unbelievable success in this region and other emerging market regions, prompting interest in it from many sectors in the world.

But M-Pesa is much more than a mobile payment system. It's a blueprint for a future mobile-based currency, used by every corner and every community in the world. It's also testament to how emerging market countries are using technology and innovation to overcome barriers. It's an example of how countries, that are largely behind the technological curve, can suddenly leapfrog into the future.

Since the mobile currency's development in the mid 2000s and Kenyan commercial launch in 2007, M-Pesa (the M is for "mobile" and Pesa is Swahili for "money") has gone from strength-to-strength both in Kenya and Tanzania.

In Kenya, payments made using the M-Pesa system now account for more than 20 percent of the country's Gross Domestic Product (GDP). According to a paper written for the Gates Foundation and published in November 2010, use of the service has been adopted by nearly 13-million households. The most marked progress being made by the system has been among Kenya's poor and rural populations - particularly among those with no access to conventional banking.

Read the full article on www.memeburn.com.