'Mobile money' competition heats up
31 March 2010
Competition in South Africa's "mobile money" space is heating up, with Nedbank and mobile operator Vodacom teaming up to launch M-PESA, a solution that enables person-to-person money transfers via mobile phone - even between people without bank accounts.
This follows hot on the heels of the launch of a similar product, dubbed Instant Money, by Standard Bank and retailer Spar.
Like Instant Money, M-PESA enables customers, regardless of whether they have bank accounts, to transfer money from person to person using their mobile phones.
"Both Nedbank and Vodacom are confident that M-PESA is going to change the lives of 'unbanked' South Africans, and we are looking forward to the imminent launch of the product," Vodacom South Africa MD Shameel Joosub said in a statement this week.
The M-PESA service was originally created as a pilot project co-funded by Vodafone and the "Financial Deepening Challenge Fund" of the British government's
Department for International Development.
Since then, the service has proved hugely successful in Kenya, Tanzania and Afghanistan, with more than 10-million M-PESA customers.
"M-PESA has a successful track record in other markets," Joosub said, adding that the service would revolutionise the way South Africans transfer, share and spend their money.
Nedbank's Saks Ntombela said the bank was "delighted to be a part of this innovative, simple money transfer product which offers easy access to funds.
"We are particularly excited about this offering being attractive to the previously unbanked population, who are not yet part of the formal banking system."
Nedbank has worked with the banking regulator to ensure that the initiative will meet all the requirements set out by the South African Reserve Bank.
"With their proven track record of providing financial services to those who are traditionally unable to afford it, and their innovative
approach to banking, we know they will bring a new dimension to the project," Joosub said.