Mobile money opens smooth traffic for business transactions

Dorcas Mwatela has just walked out of a kiosk in Mathare, where she paid the electricity bill for her salon within the estate.

“When I get back, I expect at least one of my clients today will pay me by M-Pesa,” said the 40-year-old braid specialist.

“Tomorrow, I will send my cousin in Siaya money using the service. He needs it to pay for a motor spare part.”

Just a few metres away from Ms Mwatela’s salon is a small shop that was the first outlet to offer M-Pesa, the mobile money transfer solution developed by telecoms firm, Safaricom, and launched in this market over two years ago.

A petrol station houses the small shop that first tested the service in 2005.

By its creators’ estimates, M-Pesa was only supposed to have recruited hundreds of thousands to date, and was geared towards providing a cheap money transfer service for low-income groups.

But with 6.1 million users today, the service has become a force for the small trader, who is increasingly using the cash-less system for bill payments.
Ms Mwatela’s transactions could form the basis of a new financial order.

An increasing number of small businesses have embraced the services offered by mobile money transfer products such as Safaricom’s M-Pesa and Zain’s Zap, preferring to trade using virtual money, with the operations providing the safety associated with banking.

Traders are upbeat about the services that allow them to carry a lot of money while feeling secure, pay and receive money instantly.

The systems are considerably foul-proof considering that even the unscrupulous businessmen and women who have delayed transactions with bouncing cheques have no room because one can only transfer or withdraw what they own.

Since its official launch in 2007 as a rudimentary money transfer service, M-Pesa has risen to become the country’s unofficial preferred payment model.

With six million Kenyans now using the M-Pesa service to transfer over Sh17 billion monthly, mobile money is taking on more prominence for the small trader, who sees in the product as a means to improve their business processes.

Slowly, more owners of bars, hair-dressers and clothes stores across the country are now accepting mobile money as a payment channel.

Analysts say the tool is fast becoming the disruptive technology that will revolutionise the way Kenyans treat money in this market.

“The fact that small traders are using it for bill payments was not our original intention, it is a market-driven innovation,” said Michael Joseph, Safaricom CEO.