Mobile money transfer is now the new ‘bank of the poor’

On his part, Paynet Group chief executive Bernard Matthewman argued for an interconnected automated teller machine systems among local banks and financial institutions “to get out of the current situation where a single street corner has six ATM points serving different bank customers where a single interconnected ATM point could suffice.”

Mr Matthewman, who runs the PesaPoint ATM network currently connecting 53 banks and financial institutions, added that a “ubiquitous presence of ATMs in other parts of the country would lessen bank’s dependence on midtown clients leading to development of new products and services that address the needs of new client segments.

ATM-flooded market

“Kenya has changed from the situation in 2001 when ATMs were targeted at high value account holders — the complete opposite of the practice in developed countries where cards are for low-income account holders with high-value customers being handled face-to-face by the bank.”

Central Bank of Kenya head of national payment systems Stephen Mwaura singled out Kenyan banks for their “tendency to concentrate their outlets and services on mid-town Nairobi where there is a perceived presence of target clientele.

“Adoption of technology by financial institutions and the recent reforms in the banking sector have helped mitigate against payment risk. For instance, the introduction of Real-Time Gross Settlement has enhanced efficiency and speed as transactions are conducted on real-time basis thereby mitigating payment risks for high volume payments,” said Mr Mwaura.