This is why I’m so worried that knee-jerk additional regulation of financial services in response to the current crisis will end up holding back the development of the payment sector, with really negative consequences in developing countries. A better payment system is an unalloyed good and it would be bad for lots of people if the evolution of new payment systems, especially in the developing world, were to be held back by inappropriate regulation. Payments are not banking, and while banking regulation may well need to be toughened up in many countries (as subject on which I am not qualified to comment), payment regulation may not.
One place where the regulators have allowed competition is in Kenya, where M-PESA goes from strength to strength. The latest statistics continue to amaze. Amongst them
- 5.5 million subscribers (around 17% of the population) and still increasing by around 10,000 a day
- US$30 average transaction size
- 160,000 person-to-person transfers every day
- US$4 million in transfers every day
- Just under 4,500 agents/outlets across the country.
Truly transformational. I’m going to be talking about our work on M-PESA, the impact of M-PESA in Kenya and some ideas for future development in this space at the London Finance Geek dinner on Thursday 16th April 2009. Look forward to seeing you there.
These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]