Bill Gates: Mobile money innovation to 'trickle up' to developed countries
What you need to know:
- Billionaire predicts services such as M-Pesa will eventually be adopted by wealthy nations.
Bill Gates has predicted that mobile money use will eventually be adopted in the developed world.
In the 2015 Gates Annual Letter, co-written with his wife, Melinda, and posted on his blog, the billionaire notes that mobile financial services, such as the money transfer and payment service M-Pesa in Kenya, have transformed the lives of the poor.
"The poor use financial services that are extremely inefficient… But in the next 15 years, digital banking will give the poor more control over their assets and help them transform their lives.
"By 2030, two billion people who don't have a bank account today will be storing money and making payment with their phones. And by then, mobile money providers will be offering the full range of financial services, from interest-bearing savings accounts to credit to insurance," Gates notes.
"One interesting feature of digital financial innovation is that some of it is happening in poor countries first. If we waited a few decades, banks in developed countries would invent digital banking tools, and they would trickle down eventually to developing countries.
"But because there is strong demand for banking among the poor, and because the poor can in fact be a profitable customer base, entrepreneurs in developing countries are doing exciting work — some of which will "trickle up" to developed countries over time."
TOP BRAND
A survey by the Centre for Brand Analysis released this week showed that M-Pesa was Kenya's top "superbrand", overtaking its parent company Safaricom, which was third on the list of the country's most powerful brands. The Kenya Red Cross was ranked second.
In the financial year ending March 2014, Safaricom said it enabled transactions of Sh101.3 billion per month through M-Pesa and recorded revenues of about Sh26.6 billion from it.
In an article published by The Economist in 2013 titled "Why does Kenya lead the world in mobile money?", the magazine said M-Pesa had over time realised exponential growth because “it had several factors in its favour, including the exceptionally high cost of sending money by other methods; the dominant market position of Safaricom; (and) the regulator's initial decision to allow the scheme to proceed on an experimental basis, without formal approval”.
