Banks Take On M-Pesa By Rolling Own Money Transfer Service

Currency Calculator  App

Banks Take On M-Pesa By Rolling Own Money Transfer Service

Banks in Kenya have activated their inter-bank money transfer switch to allow their customers transfer money from one bank account to another. This development is likely to boost competition among money transfer service providers.

The Kenya Bankers Association (KBA) obtained approval from the Central Bank of Kenya to activate the inter-bank transactions starting from Ksh Sh 10 to KSh 999,999 via the PesaLink platform. This new money transfer service will compete directly with M-Pesa and Airtel Money.

The launching of this new platform is likely to attract both low-end and high-end customers. Its main target is to attract the unbanked population with a product that will allow the transfer of small amounts such as paying for a haircut, bus fare or groceries at the market.

“The new service, a flagship product of IPSL, will save customers from the costly and long processing of transferring and accessing money. KBA is coming up with new terms that will define the landscape of payment ecosystems,” Habil Olaka the KBA Chairman told the press in Nairobi.

“This new service will allow customers to transfer money from one bank account to another in real time 7 days a week without going through intermediaries,” he added.

Customers in Kenya had to endure the expensive and very tiresome process of withdrawing money from their bank accounts into their mobile phones and sending it to their recipients’ mobile phone.

The bank channels that will be used to facilitate cash transfers include mobile banking, bank agents, bank branches, Internet banking, and ATMs. While at the beginning the service will be open to customers with Kenyan banks accounts, Integrated Payment Services Limited is pushing for more development to open this new service to those who don’t have bank accounts and who depend on a one-time password to start transactions.

In running the platform, the Integrated Payment Services Limited will charge a service fee of around Sh11 but each bank may come up with its competitive fees. We are sure that the price will be more competitive compared to what customers pay today,” said Jenifer Theuri who is the IPSL Chief Executive.

In Other News

Last month, Thailand launched a new mobile payments system allowing customers to transfer money easily and cheaply than those offered by conventional banks. This mobile payments scheme aimed at pushing Thai people into the formal economy.

The money transfer system, PromptPay, enables registered customers to transfer their funds to the other people using only the national ID number and mobile number of the recipient.

"For 10 years, we have made several attempts trying to bring new changes in payment methods from cash-based methods to digital ones. Finally, we have taken the first milestone to a cashless society,” Finance Minister Apisak Tantivorawong told reporters.

The launch, which was initially scheduled for October last year, did not happen because of some technical glitches on the platform. In December, Thailand government authorities began testing the system by sending welfare payments to low-income people.

However, the government has said that PromptPay money transfer service will only be available for a small number of retail customers at the beginning. Transactions below 5,000 Baht are free of charge. A small fee of around 2 baht is charged for money transfer transactions between 5,001 baht to 30,000 baht. A transaction fee of 5 baht is charged for transactions between 30,001 Baht and 100,000 baht. The system will charge a transaction fee of 10 baht for transactions of 100,001 baht or more.

Company Details

Banks Take On M-Pesa Money Transfer Service

Get a quick quote

Open Account with GCEN

GCEN are located at:
GCEN The Old Barn, Oasts Business Village, Red Hill, Wateringbury, Maidstone, Kent, ME18 5NN, United Kingdom

Get a Quick Quote

Newsletter Signup to CMT

Sign up to our foreign exchange newsletter to receive news updates directly by email

Compare Money Transfer will not Share your details!

Bank Exchange Rates Comparison

High St Bank Exchange Rate

All Rights Reserved: Copyright 2006 - 2018 Compare Money Transfer Limited offering FCA Regulated Suppliers - 34 New House, 67-68 Hatton Garden, London, EC1N 8JY. +44 (0) 843 357 4882