100m newly ‘banked’ people: What mobile money has done in a decade

It’s pretty much accepted wisdom that Africa has been at the forefront of mobile payment tech for a while now. But how many of you knew that the first mobile financial service in an emerging market went live 10 years ago in Africa?

Celpay, which is powered by South African-based company Fundamo, launched in Zambia way back in 2002. That’s a full five years before Kenya’s mobile darling MPesa went live.

It was the first in a series of services aimed at banking the unbanked on the continent. In those 10 years, 100-million people have been newly ‘banked’ using mobile technology.

Back then Fundamo was an independent company. Today it’s wholly owned by Visa after being bought out for US$110-million.

“The launch of the Celpay service ten years ago was the beginning of a community that has had a profound social, economic and technological impact in Africa and beyond,” said Fundamo CEO Hannes van Rensburg,. “Implementations such as the one we started in Zambia have ignited the imagination of our community and the wider world. As we look to the future, we are certain that mobile will continue to play a critical role as a driver of financial inclusion worldwide”.

Emerging market firsts
Celpay International provides mobile financial service to consumers and corporate customers. Celpay’s first deployment in Zambia launched in partnership with six major banks, to provide a secure and convenient method to transfer money. Celpay enabled instantaneous payments via the mobile phone, and in doing so, removed the risks associated with cash and cheque payments in Zambia.

Since its initial launch, Celpay International has processed in excess of US$2-billion in mobile payments and counts global brands such as SABMiller, Total and BP as customers.

Between 2005 and 2010 Celpay Zambia processed funds equal to 10% of the Zambian GDP. Today, the service partners with 15 banks and has expanded into the Democratic Republic of Congo, Zimbabwe and Uganda.

“When we launched Celpay in Zambia, we had no idea that we were pioneers. We just found a solution to a business problem using mobile technology,” said Lazarus Muchenje, Chief Executive of Celpay International. “The Zambian deployment was a runaway success and gave a glimpse of the potential mobile financial services had to offer. We are incredibly proud of how far we, and the industry as a whole, has come over the last decade.”

Where to next?
Mobile money has come a long way in the last decade but it’s still far from reaching its potential. According to the GSMA, 2.5-billion adults still lack access to formal financial services, such as savings, payments, loans and insurance[2]. This has led Juniper Research to forecast that the number of newly ‘banked’ people will double to 200 million by 2013.

“The last ten years has shown that mobile technology can be an invaluable tool in enabling a sustainable, scalable approach to providing convenient and affordable financial services to the unbanked. The achievements of the mobile financial services community should certainly be celebrated but there is so much more to be done,” said Seema Desai, Director for the Mobile Money for GSMA’s Unbanked Programme. “More than one billion customers in developing markets have access to a mobile phone, but do not have a formal bank account. We will continue to work closely with the community to ensure that every person at the base of the economic pyramid can access financial services.”