Inter-network mobile money transfers in Kenya now a reality

By MACHARIA KAMAU

Times when mobile money transfer customers can seamlessly send money across networks are almost a reality.

Recent developments have seen mobile operators push the limits as they compete for customers, and introduced features on their services that make it possible for subscribers to send money to rival networks.

And now analysts say initiatives witnessed in the last one week might set the stage for the development of an inter-network mobile money transfer system that would enable transfers among the networks as is the case with transferring money between bank accounts held at two different banks.

Orange Money, launched last week by Telkom Kenya, allows customers to send money to mobile phone users on other networks.

Zain mirrored the Telkom Kenya the move on Friday when it announced that Zap customers could send money to subscribers on other networks.

But it is Yu Cash, operated by Essar Telecoms Kenya, that was the first to open doors to competition when it enhanced features of the money service, making it open to subscribers of rival companies.

"Subscribers on other networks will receive a text message giving them the details of the transaction. They can then withdraw the money from an Orange Money agent," said Snehar Shah head of Orange Money.

"The idea is to make it open to any one with a mobile or a bank account."

using technology

Essar said the move was made possible by making use of technology not used by other networks .

"The added features will enable users of Yu Cash to transact or manage their accounts via more than one channel for registration and transactions…it has additional features that make it open to a variety of uses," Atul Chaturvedi, country manager, Essar Telecoms said in September.

"The unique platform lets customers transfer money using their mobile phones and if the recipients are on rival networks, they receive text messages when they are sent money and can collect it at Yu Cash agents."

Similar approach is taken by on Zap where money to other networks can only be withdrawn from Zap agents.

"Sending money to other networks attracts the normal charge of Sh10 per transaction which is equivalent to sending on-net."

"Subscribers on other networks receiving money through Zap are required to withdraw the money through any Zap agent. An extra Sh30 is charged for withdrawal."

The inter-network mobile money transfer may still be at its rudimentary stage, because money sent to a rival network does not go into the recipient’s mobile money account.

But experts have noted that inter-network money transfer might be the next big innovative aspect in the mobile money industry and a contributing factor in the growth of mobile money and mobile banking.

DIFFERENT BANKS

"Competition will have to come up with a solution to facilitate inter-network money transfers, to enable money transfers among networks, similar to transferring money between bank accounts held at two different banks," Alexander van Schie director financial advisory at Deloitte told The Standard at a past interview.

"Part of that solution is likely the introduction of an independent platform that will need to oversee the inter-network clearance and settlement of money transfers."

"Given that Kenya is most advanced in mobile money transfers, transferring money between networks should be another revolutionary development."