Mobile banking laws should not restrict capital inflow

For instance, what happens when monies are accidentally transferred to the wrong transferee or when funds “disappear” or financial yet confidential details of customers are divulged for wrongful purposes?

Consideration should also be given to whether the customary duties of bankers such as duty of care, duty of confidentiality and other similar duties should also be extended to the providers of these services.

Service providers
Or is it simply enough to leave these important issues to be dealt with in unnegotiated contracts entered into between customers and the money transfer service providers?

Obviously, the new and unconventional alternative money transfer systems are drawing increasingly large sums of money.

Apart from concerns related to money laundering, it is likely to make the planning of national financial systems more complex.

However, care has to be taken not to throw the baby out with the bath water.

The regulation of the money transfer sector must not unduly restrict or discourage these remittances or stifle the growth of innovative and cheap payment mechanisms.

Ms Kiunuhe is an advocate in Nairobi. ak@africalegalnetwork.com