Kenya's mobile revolution and the promise of mobile savings

Gabriel Demombynes () and Aaron Thegeya

No 5988, Policy Research Working Paper Series from The World Bank

Abstract: The mobile revolution has transformed the lives of Kenyans, providing not just communications but also basic financial access in the form of phone-based money transfer and storage, led by the M-PESA system introduced in 2007. Currently, 93 percent of Kenyans are mobile phone users and 73 percent are mobile money customers. Additionally, 23 percent use mobile money at least once a day. New potential for mobile money has come with the rise of interest-earning bank-integrated mobile savings systems, beginning with the launch of the M-KESHO system in March 2010. The authors examine the mobile savings phenomenon, using data collected in a special survey in late 2010. They show that the usage of bank-integrated mobile savings systems like M-KESHO remains limited and largely restricted to better-off Kenyans. However, what the authors term"basic mobile savings"-- the use of simple mobile money systems as a repository for funds -- is widespread, including among those who are otherwise unlikely to have any savings. Holding other characteristics constant, those who are registered for M-PESA are 32 percent more likely to report having some savings.

Keywords: Banks&Banking Reform; Emerging Markets; E-Business; Economic Theory&Research; E-Finance and E-Security (search for similar items in EconPapers)
Date: 2012-03-01
New Economics Papers: this item is included in nep-afr, nep-ban and nep-mfd
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

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