Mobile Commerce: A Rising Trend


In developing nations, 64% of people do not have access to banking service. The reason is simple. They do not qualify for bank accounts, because they do not have enough money. Ironic, don’t you think? However, a new service has emerged and is sweeping Africa by storm. It is called Mobile Money.

Mobile bank accounts are creating business and slowly being adapted as a part of life. People can deposit, withdraw, and transfer money using their cell phones. Kenya is currently the largest market for mobile money; between 2011-2012 mobile deposits averaged to SH672 billion, which is equivalent to US$8 billion. The expansion of this money service is so great that Kenyans will be able to renew driver licenses through mobile money transfers (MMTs). [1]

Some of the benefits of having a mobile banking account are: convenience and expediency, accuracy through transparent and documented payments, and lower costs of transactions. The downfalls of mobile banking are: potential identity theft issues, additional fees for transferring money from account to account, a possible 10% tax for each transaction, and strong dependence on SMS connection. Microfinance institutions will soon adopt mobile banking. This will save time and effort of traveling to the individual’s home to distribute loans.

Mobile commerce is taking off in the U.S. too. Banking corporations have made it easier to check up on accounts through their own app. More and more companies are starting to go mobile; retail and food service stores like Nordstroms and Starbucks are using a device called Square. Launching in 2010, the Square is a unique invention that allows anyone to accept credit card payments. The square accepts all major credit cards; and is compatible with iOS and Android. To use this neat little gadget, the user must connect the Square reader to their device, download the app (which is free), and it’s good to go! The user has the flexibility to choose a payment plan: monthly or by swipe. What can be easier than this? Not only is it helping large corporations, it’s the perfect tool to get a small business going.

So what does the future hold for mobile commerce? The sky is the limit, really. It is already bringing new hope to areas with little to no opportunities, as well as changing the US. Just expect there to be many changes in the next coming years.



*Disclaimer: The views represented here are the opinions of the individual blog author and do not represent the views of Oikocredit USA. 


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