Mobile banking to help people out of poverty

Written by Emile Stragyte

Access to the financial system is necessary to promote economic activity. From getting cash to applying for loans – it promotes individual mobility and economic growth. However, in some countries it is still hard. In Senegal, for example, only 8 percent of the population has a bank account. Fintech has proposed a simple yet effective solution – mobile banking.

The most important difference between a mobile money account and other mobile payments is no need for a bank account. This leads to a huge increase in the access to the financial system in countries where reaching a bank may be difficult. In Kenya, 72 percent of the population and 96 percent of households have a mobile money account.

The most significant outcome of using mobile payment is its role in reducing poverty. An MIT study estimated that since 2008 access to mobile money services increased daily per capita consumption levels of 194,000, or roughly 2 percent, of Kenyan households, lifting them out of extreme poverty (living on less than $1.25 per day).

Click Below for Further Reading!

Study: Mobile-money services lift Kenyans out of poverty

M-Pesa: Kenya's mobile money success story turns 10

What Kenya can teach its neighbors — and the US — about improving the lives of the “unbanked”

DISCLAIMER: The contents of this website are solely owned by the author of each article and does not represent the views of the Awareness Committee or the Editorial team.