It seems as though first world structures can some times be an obstacle to innovation. Currently, Kenya, Tanzania and Afghanistan are leading the way in the field of mobile commerce.
M-Pesa was first launched by Safaricom in Kenya, in March 2007 M-Pesa quickly captured a significant market share for cash transfers, and rapidly grew, capturing 6.5 million subscribers by May 2009 with 2 million daily transactions in Kenya alone. As of November 2011, M-Pesa has over 14 million subscribers and well over 28,000 agents across the country.
The growth of the service forced formal banking institutions to take note of the new venture. In December 2008, a group of banks reportedly lobbied the Kenyan finance minister to audit M-Pesa, in an effort to at least slow the growth of the service. This ploy failed, as the audit found that the service was robust.
'Texteagle', an "artificial artificial intelligence" system, enables the 3 billion mobile phone subscribers living in the developing world to earn small amounts of money by completing simple tasks for companies who pay them in airtime or M-Pesa.
The initial concept of M-Pesa was to create a service which allowed micro-finance borrowers to conveniently receive and repay loans using the network of Safaricom airtime resellers. This would enable micro-finance institutions (MFIs) to offer more competitive loan rates to their users, as there is a reduced cost of dealing in cash. The users of the service would gain through being able to track their finances more easily. But when the service was rolled out on a trial basis, customers adopted the service for a variety of alternative uses and complications arose with Faulu, the partnering MFI. M-Pesa was re-focused and launched with a different value proposition: sending remittances home across the country and making payments.
M-Pesa is a ‘branchless banking, service, meaning that it is designed to enable users to complete basic banking transactions without the need to visit a bank branch. The continuing success of M-Pesa in Kenya has been due to the creation of a highly popular, affordable payment service with only limited involvement of a bank.