A recent mint article on mobile money throws light on what the World Bank in Africa has labelled as a “cornerstone for development” for its potential to mobilize remote rural economies.
Consider this, in Kenya only one in five people have bank accounts, correspondingly the number of cellphones are growing extremely fast to 270 million in 2007 from just 50 million in 2003. To address this anomaly, M-PESA, the virtual cash network that means mobile money in Swahili, Kenya’s lingua franca, has hit up on a mechanism which has garnered 6.5 million customers, or one in six Kenyans, in just over two years.
Raghav N, IFMR Trust (presently known as Dvara Holdings) has to say that “There are regulatory issues which will preclude replication in India. As such we do not believe that using the mobile services operator as a replacement for banking channels without the requisite regulations and prudential safeguards in place is such a great idea. The promise that mobile as a delivery channel holds is still significantly exciting and that sentiment is valid for India as well”.