Cross border M-Pesa future of Africa’s mobile money platforms


M-Pesa is the lowest cost channel for sending money from Kenya to Tanzania and Rwanda at around 3 per cent of the transaction value today.

This is according to a Vodacom report released during a stakeholders’ meeting in Tanzania.

The report points out that regulators can support this transformation by adopting a progressive, proportionate, and pro-mobile approach to remittances.

The sustainable mobile payment ecosystem

“Embracing the fact that mobile is the channel of the future – and the present – means regulators can focus on ways to leverage the strengths of mobile channels, rather than the ways in which mobile money is “less than” traditional banking services,” notes the report.

Stakeholders from 8 African countries are meeting in Tanzania to deliberate on policies and frameworks to drive innovation, technology and sustainable mobile payment ecosystem.

Key representatives from these 8 countries gathered at a workshop organized by Vodacom to look into trends and developments shaping the mobile money industry in Africa.

It is at this meeting that Vodacom also released its Future-Proofing Mobile Financial Services report at the workshop.

Driving economic growth

The report, the first of Vodacom’s Public Policy Series, demonstrates how mobile money is driving economic growth and empowering lives through financial inclusion.

Managing Executive, Legal and regulatory from Vodacom Group, Judith Obholzer, said that Sub- Saharan Africa, including Tanzania, has witnessed rapid growth in mobile money operations and innovations enabling broad-based participation and access to financial services.

Sub-Saharan Africa is home to the 10 economies worldwide where more adults now have mobile money accounts than at a financial institution.

Mobile Money continues to drive economic growth and social benefit by providing access to financial services to the millions of people who have a mobile phone but do not have or have only limited access to a bank account.

“The industry continues to evolve at a rapid pace with policymakers and regulators playing a central role in facilitating and enabling the environment for financial inclusion,” said  Obholzer.

A representative of the Bank of Tanzania who is Assistant Manager–Oversight and Policy at the National Payment systems Department, Albert Cesari underscored the important impact Mobile Financial Services have made on the economy and the important role of the workshop in ensuring the sustainability of the mobile financial service industry.

“The government is committed to ensuring that mobile financial providers continue to be effective players in the future and that they are able to provide the innovations and investments necessary in the technical and business dynamics in the financial payment market,” Cesari explained.

The success of M-Pesa

Since its launch in 2007, M-Pesa has become Africa’s most successful mobile money service.

According to Rachel Balsham (MFS Africa), cross-border remittances play a critical role in Africa’s economy and regulators and policymakers can work towards reducing the costs of remitting to 3 per cent.

“Today, the costs of sending money to Africa average 9 per cent of the transfer amount and costs of sending money between African countries average 10 per cent, but they can exceed 15 per cent. Mobile money has proven to be a game-changer if the regulatory conditions are right.”

Balsham adds that 70 per cent of African migration occurs within the continent driven by the pursuit of economic opportunity.

“This means that remittances – and other types of cross-border payments – can play an important role in accelerating regional integration. Remittances aren’t the only use case in the cross-border payments space. 80 per cent of cross-border revenues are based on B2B transactions, and this segment is expected to increase as more SMEs participate in the global economy,” the report adds.

The report notes that consumers across Africa and the world want to do business in the same way they want to communicate, consume knowledge and entertainment, and travel – unimpeded by borders.

“Progressive, proportionate, and pro-mobile approaches in regulation can help bring about a world in which people can transact freely, safely, and securely with whomever they choose. Whether for family remittances or microenterprise, mobile money is the ideal channel to enable low-cost, accessible, and transparent cross-border payments.”

According to research, mobile money has significantly contributed to social empowerment, economic growth and poverty reduction. It provides people with a safe, secure and affordable way to send and receive money, top-up airtime, make bill payments, receive salaries and get a short-term loan.

Speaking during the launch of the new research on mobile money, Hisham Hendi, Managing Director, Vodacom Tanzania said:  “Mobile money – supported by extensive mobile reach – has proven to be a platform for economic opportunity, transforming the financial services landscape, in particular on the African continent.”

Read: Why it’s not if but when Africa crumbles over rising debt

I have 10 years of experience in multimedia journalism and I use the skills I have gained over this time to meet and ensure goal-surpassing editorial performance. Africa is my business and development on the continent is my heartbeat. Do you have a development story that has to be told? Reach me at and we can showcase Africa together.

Comments are closed.