Migrant remittance is one of the most important sources of income for many developing countries – the World Bank estimated that the annual worldwide value of remittances in 2006 totalled $268bn. But sending and receiving such payments can be costly and not particularly secure. Enabling money to be transferred internationally from person to person using mobile technology could greatly assist the flow of funds from migrant workers to their families in developing countries.
International mobile telecoms group Vodafone is one of the first mobile telco operators to tap into this potential. In October 2005, it established a pilot project, M-PESA, in Kenya through its local affiliate Safaricom. In February this year, the pilot phase ended and M-PESA was launched as a mobile payment solution aimed at mobile customers who do not have a bank account. Users can put money into their Safaricom account by depositing cash at a local agent, send money to other mobile phone users by SMS even if they are not Safaricom subscribers, withdraw cash at a local agent and buy Safaricom airtime for themselves or other subscribers.
