M Pesa PESTE Analysis V2
POLITICAL
Safaricom and Vodafone have maintained a strong relationship with the Central Bank of Kenya. The fact that the Kenyan government owns 35% of Safaricom has made it easier for regulations to be approved.
Mobile technology is widely used in Kenya’s democratic process as political parties and individuals seek to communicate to the electorate through various media, including SMS, MMS, video and audio clips.
ECONOMIC
M-Pesa has a multitude of economic benefits as it facilitates safe storage and transfer of money at lower transaction costs. It simply facilitates trade, making it easier for people to pay for, and to receive payment for, goods and services. Payment of electricity bills can be paid without waiting in a long queue; consumers can purchase cell phone credit without moving; and taxi drivers can operate more safely, without carrying large amounts of cash.
By providing a safe storage mechanism, M-Pesa could increase household savings and reduce losses due to theft. By making transfers across large distances at a trivial cost, households may be more likely to send members to high-paying jobs in distant locations either on a permanent or temporary basis, and to invest in skills that are likely to earn a return in such places but not necessarily at home.
SOCIO-CULTURAL
Safaricom based its launch of the M-Pesa service on the brief but powerful phrase “send money home’. It capitalized on the fact that demand for domestic remittance services is greater in locations where migration has occurred, separating families, particularly where the bread-earner moves to an urban centre and the rest of the family remain home. This was certainly the case in Kenya, where 17 percent of households depended on remittances as their primary income source.
Remittances were seen to be the strongest when there is cultural pressure to retain a connection with one’s ancestral village. In Kenya, migrant’ ties with rural homes are reinforced by an ethnic concept of
Safaricom and Vodafone have maintained a strong relationship with the Central Bank of Kenya. The fact that the Kenyan government owns 35% of Safaricom has made it easier for regulations to be approved.
Mobile technology is widely used in Kenya’s democratic process as political parties and individuals seek to communicate to the electorate through various media, including SMS, MMS, video and audio clips.
ECONOMIC
M-Pesa has a multitude of economic benefits as it facilitates safe storage and transfer of money at lower transaction costs. It simply facilitates trade, making it easier for people to pay for, and to receive payment for, goods and services. Payment of electricity bills can be paid without waiting in a long queue; consumers can purchase cell phone credit without moving; and taxi drivers can operate more safely, without carrying large amounts of cash.
By providing a safe storage mechanism, M-Pesa could increase household savings and reduce losses due to theft. By making transfers across large distances at a trivial cost, households may be more likely to send members to high-paying jobs in distant locations either on a permanent or temporary basis, and to invest in skills that are likely to earn a return in such places but not necessarily at home.
SOCIO-CULTURAL
Safaricom based its launch of the M-Pesa service on the brief but powerful phrase “send money home’. It capitalized on the fact that demand for domestic remittance services is greater in locations where migration has occurred, separating families, particularly where the bread-earner moves to an urban centre and the rest of the family remain home. This was certainly the case in Kenya, where 17 percent of households depended on remittances as their primary income source.
Remittances were seen to be the strongest when there is cultural pressure to retain a connection with one’s ancestral village. In Kenya, migrant’ ties with rural homes are reinforced by an ethnic concept of
Bibliography: 1. IBRD / The World Bank, 2011, Yes Africa Can 2. Plyler, M. G., Haas, S. & Nagarajan, G., June 2010, IRIS Center, University of Maryland, Community-Level Economic Effects of M-Pesa in Kenya: Initial Findings 3. IFC / The World Bank Group, M-Money Channel Distribution Case 4. Hughes, N. & Lonie, S, 2007, M-Pesa: Mobile Money for the “Unbanked”, Innovations / winter & spring 2007 5. Mas, Ignacio & Radcliffe, Dan, March 2010, Bill & Melinda Gates Foundation, Mobile Payments go Viral: M-Pesa in Kenya