Feeds

Vodafone brings African tech to Europe

Maybe we will catch up with Kenya

Using blade systems to cut costs and sharpen efficiencies

Vodafone is to launch mobile-money-for-the-masses service M-Pesa in Romania, which introduces and interesting challenge for the European telcos and banks who have spent a decade wrangling over mobile money and got nowhere.

M-Pesa was launched in Kenya under the stewardship of Nick Hughes of Vodafone, initially as a corporate social responsibility programme. It has since become the principal form of money transfer in the country, with Vodafone using two banks behind the scheme but with five times as many users as all the banks in Kenya combined. Over a year ago, the Financial Times reported that 31 per cent of Kenyan GDP was handled through M-Pesa.

An M-Pesa subscriber can go to a Vodafone dealer or appointed agent and hand over cash to have it credited their M-Pesa account. They can then send a text to anyone they want to send money to. The receiving user does not have to have an M-Pesa account or even be a Vodafone subscriber. The recipient then shows the text to a Vodafone agent near to where they live and it is used to authorise payment, the recipient receiving the cash.

Typically it's used by people working away from home to send money back to their families, but in Kenya it has become such a dominant force it is normal for people to send M-Pesa credit to one another for everyday transactions such as taxi journeys, buying animal feed and school fees. The 17 million active Vodafone M-Pesa customers make over of €900m worth of person-to-person transactions a month, says the company.

The service is many times cheaper to use than systems like Moneygram and Western Union. While they might cost a significant percentage of the cost of the transfer, M-Pesa transactions typically costs 50 cents. From its roots as a corporate social responsibility project, the service is still ostensibly designed to serve the people sending and receiving the money and make them more able to afford phone credit top-ups. It also makes subscribers incredibly loyal.

Former head of Safaricom - Vodafone in Kenya - Michael Joseph, who's now Vodafone's director of mobile money, said: “The majority of people in Romania have at least one mobile device, but more than one-third of the population do not have access to conventional banking. Vodafone M-Pesa is already used regularly by nearly 17 million customers and we look forward to bringing the significant benefits of the service to the people of Romania.”

Mobile money schemes are often regarded with suspicion by the traditional banks and regulators, which impose strict limits on how much money can be transferred. Vodafone does not seem to have had a problem, or at least has negotiated past the problem, in Romania and customers will be able to transfer up to 30,000 lei a day, roughly equivalent to €6,715 or £5,500.

The service starts with 300 Vodafone Romania stores in a mix of city and rural locations and will be rolled out to a target of 2,000 locations over this year.

The introduction of the service into Europe will likely be watched carefully by financial and governmental regulators. ®

HP ProLiant Gen8: Integrated lifecycle automation

More from The Register

next story
Yorkshire cops fail to grasp principle behind BT Fon Wi-Fi network
'Prevent people that are passing by to hook up to your network', pleads plod
Major problems beset UK ISP filth filters: But it's OK, nobody uses them
It's almost as though pr0n was actually rather popular
Microsoft unsheathes cheap Android-killer: Behold, the Lumia 530
Say it with us: I'm King of the Landfill-ill-ill-ill
All those new '5G standards'? Here's the science they rely on
Radio professor tells us how wireless will get faster in the real world
Apple orders huge MOUNTAIN of 80 MILLION 'Air' iPhone 6s
Bigger, harder trouser bulges foretold for fanbois
US freemium mobile network eyes up Europe
FreedomPop touts 'free' calls, texts and data
'Two-speed internet' storm turns FCC.gov into zero-speed website
Deadline for comments on net neutrality shake-up extended to Friday
Oh girl, you jus' didn't: Level 3 slaps Verizon in Netflix throttle blowup
Just hook us up to more 10Gbps ports, backbone biz yells in tit-for-tat spat
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.