Essay: The impact of mobile payment transfer systems in Africa
It is of paramount importance to note that most small business enterprises in the developing world and especially Africa have resulted to mobile funds transfer as way of debt payment. It is widely used in Africa by the major mobile phone service providers entering in to contracts with the local banks to make this service a success. The reason why most small business entrepreneurs are using this method of payment is that it is easy to use and cheaper. (Anurag, Tyagi, & Raddi 2009) Despite the fact that mobile telephony is not that old in Africa, it is worth noting that most of the people of these countries have access to mobile phones. Those who are very poor such that they are not able to afford phones use public phones or borrow from their friends.
The way businesses are conducted in Africa has gone through a tremendous change over the recent past. One of the most important changes is the fact that information technology has been able to be incorporated in the African businesses. There are several mobile service providers in Africa, which have started of providing money transfer to their subscribers. The most notable one is Safaricom, which is partly owned by Vodafone and the Kenyan public. It launched the money transfer service in March, 2007 after the Kenyan government had approved the plan. Zain, which also operates in Kenya, got a license to offer a similar service to its services and they named it Zap. Another good example is the MTN banking, which is owned by MTN and is operational in South Africa. The main aim of introducing this service to the people is to give the unbanked people a chance to have access to the banking life. With most inhabitants of the African continent having no access to banking, mobile service providers saw an opportunity to offer their customers a way of keeping their money safe. Most of these companies claim that they realized that there was a lot of money lying idle in peoples’ houses and it had to bring back to circulation.