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Kenyan M-Pesa introduced in Europe

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Mobile money transfer system M-Pesa, which is a Kenyan brainchild,  has been launched in Romania, signalling the imminent migration of African technology to Europe.

Mobile money transfer systems have caused a paradigm shift in Africa causing many businesses and humanitarian agencies to change ways in which they conduct business. It has also transformed the lives of millions of Africans who have limited access to traditional banking services. It however remains to be seen whether M-Pesa will enjoy the same success in Europe.

The concept of M-Pesa is simple. Customers receive and send money through their mobile phones through a text messaging technology.

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Following its launch in Kenya some seven years ago, M-Pesa has since expanded to several African countries, including South Africa, Uganda, Tanzania and Democratic Republic of Congo.

Mobile telecommunications operator Vodafone, which developed the technology, has recently introduced it to Fiji and India. The company noew set its sights on Europe following the rollout of M-Pesa last month in Romania.

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“We chose Romania because there was, and there is still, a large part of the population which doesn’t have a bank account,” said Claire Alexandre, who leads M-Pesa’s Commercial and Strategy team within the Vodafone group. “Only about 50 percent of the population of Romania has a bank account. And the other half is mostly still using cash.”

VOA cited Alexandre saying that even Romanians who have bank accounts mostly use them to withdraw their salaries. They then depend on cash transactions for the rest of the month.

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That’s a habit Vodafone wants to change. The company said: “it’s too early to talk about the number of M-Pesa customers there, but it’s clear that Africa — where mobile phone use has exploded — offers a lesson for Europe.’

“Looking at how people communicate with each other, how they interact with each other, we realized that people talk to each other, but often they need to send or to receive money from each other,” said Alexandre, as cited by VOA. “So we’ve expanded that further. So if you look at those basic needs, then there are other markets where those needs haven’t been met either. And we saw that was actually the case in Romania.”

According to VOA, thus far, Vodafone hasn’t announced any plans to expand elsewhere in Europe. Experts suggest it might be eyeing other markets, though, in eastern and central Europe.

Alexandre was adamant that markets appear to cherish the brand name. “So wherever it next travels, M-Pesa will keep its moniker and its Swahili roots.”


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