page_title: M-Pesa
section_title: Concept
hierarchical_section_title: M-Pesa / History / Concept
caption_attribution_description: English: Image showing an individual using the MPESA mobile money transfer.
context_page_description: M-Pesa is a mobile phone-based money transfer service, payments and micro-financing service, launched in 2007 by Vodafone Group plc and Safaricom, the largest mobile network operator in Kenya. It has since expanded to Tanzania, Mozambique, DRC, Lesotho, Ghana, Egypt, Afghanistan and South Africa. Meanwhile services in India, Romania, and Albania have been terminated amid low market uptake. M-Pesa allows users to deposit, withdraw, transfer money, pay for goods and services, access credit and savings, all with a mobile device.
  The service allows users to deposit money into an account stored on their cell phones, to send balances using PIN-secured SMS text messages to other users, including sellers of goods and services, and to redeem deposits for regular money. Users are charged a small fee for sending and withdrawing money using the service.
  M-Pesa is a branchless banking service; M-Pesa customers can deposit and withdraw money from a network of agents that includes airtime resellers and retail outlets acting as banking agents.
  M-Pesa has spread quickly, and by 2010 had become the most successful mobile-phone-based financial service in the developing world.
context_section_description: The initial concept of M-Pesa was to create a service which would allow microfinance borrowers to conveniently receive and repay loans using the network of Safaricom airtime resellers. This would enable microfinance institutions (MFIs) to offer more competitive loan rates to their users, as costs are lower than when dealing in cash. The users of the service would gain through being able to track their finances more easily. When the service was piloted, customers adopted the service for a variety of alternative uses and complications arose with Faulu, the partnering MFI. In discussion with other parties, M-Pesa was re-focused and launched with a different value proposition: sending remittances home across the country and making payments.
caption: Image showing an individual using the MPESA mobile money transfer.