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Kenya's mobile revolution and the promise of mobile savings
 
Author:Demombynes, Gabriel; Thegeya, Aaron; Collection Title:Policy Research working paper ; no. WPS 5988
Country:Kenya; Date Stored:2012/03/06
Document Date:2012/03/01Document Type:Policy Research Working Paper
SubTopics:Emerging Markets; Economic Theory & Research; Banks & Banking Reform; E-Finance and E-Security; E-BusinessLanguage:English
Region:AfricaReport Number:WPS5988
Volume No:1 of 1  

Summary: 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.

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