USSD the unsung hero of financial services in Kenya


The need for financial services has spurred innovation across the continent.

Calls over the past decade have been to bank the unbanked, an arguable position stemming from the different perspectives for and against traditional institutional frameworks under which banks fall.

The desire to make, move, grow, consume and access money in its various states is common, transcending culture, currency and country.

The five money actions mentioned cannot exist or work in isolation. They are beneficial when adopted at scale, when volume grows, and each is readily accessible.

The digital transformation wave has us more intent on driving inclusion and thinking through what that term means when building user experiences and choosing a technology stack.

As smartphone adoption grows and mobile connectivity picks up, more services incline towards installable mobile applications. User experiences can be elegant, and services feature-full. But with everything, we must consider the primitives and what form and function those take. In this case, the primitive to which we apply the five actions is hard cash.

The storage requirements for a fully-fledged mobile app may see a consumer trade off an installation based on how they spend their device time. For large parts of any addressable population in emerging markets, the need for connectivity, a non-issue for most reading this, affects usage and perception of services that require it for access.

USSD, a communication protocol accessible from most GSM phones was in the early days of mobile phone adoption, used only for simple services like airtime top-up. It has since matured to bring the best of accessibility and cost.

Many banks and saccos now have USSD access that allow for ‘offline’ access to banking, saving and credit services for millions of consumers. Given this utility, we see mobile applications built to take advantage of the server side processing nature of USSD.

Lighter apps that work well for the phone real estate and storage-conscious consumers come as a result. A great plus is that USSD is session-based and does not require always-on connectivity.

Hover, a technology startup, has built a software development kit that enables developers to marry USSD automation to Android applications. Stax, their showcase app is available in nine African countries and growing. It shines in presenting possible UX.

They have mapped out hundreds of services in each market, from mobile network offerings, mobile money, banking, loan apps, billers, to general utilities.

The killer use case I am waiting to see is in decentralised finance. USSD, coupled with mobile money and open banking can unlock transformative products and services across the continent.

Njihia is the head of business and partnerships at Sure Corporation | | @mbuguanjihia