what is m pesa 
m pesa is a mobile banking service that allows users to store and transfer money through their mobile phones m pesa was introduced in kenya as an alternative way for the population of the country to have access to financial services safaricom the largest mobile phone operator in kenya launched m pesa in 2007 it has been a joint venture of safaricom and vodacom since 2020 and serves the democratic republic of congo drc egypt ghana kenya lesotho mozambique and tanzania 1m stands for mobile and pesa means money or payment in swahili 2one of the drives for fintech innovations like m pesa is financial inclusion which is mostly geared toward underbanked or unbanked people financial inclusion seeks solutions for residents who have no access to banks or who can t afford the required minimum deposits in the digital banking era in order for this initiative to succeed different sectors must collaborate in sharing data with each other to build a meaningful digital platform this cross communication tactic used by m pesa is developing rapidly in sub saharan africa where the telecommunication and banking sectors are working together to create mobile banking services for those with limited access to traditional banking understanding m pesam pesa is a virtual banking system that provides transaction services through a sim card once the sim has been inserted into the card slot of the mobile device users can make payments and transfer money to vendors and family members with sms messages users with no bank accounts can access the numerous m pesa outlets distributed across the country the money that needs to be stored is given to the kiosk attendant who transfers the amount in digital form to the user s m pesa s account cash collected digitally is stored in an m pesa trust account the bank accounts function like regular checking accounts from which bills can be paid deposits can be received and more m pesa provides receipts as proof of transaction all transactions require a pin and both parties receive an sms notification with the full name of the counterparty and the amount of funds deposited or withdrawn from the user s account the mobile receipt which is received within seconds helps to promote transparency for all individuals involved in a transaction 21an example of m pesaa farmer with no bank account wants to deposit his commodity sale proceeds of 1 000 shillings to his m pesa account he deposits the money with a kiosk agent or attendant the agent in turn uses their phone to access the client s account with the client s registered phone number and credit the account for 1 000 shillings the farmer gets an sms notification within seconds of the deposit confirming how much was deposited and what his account balance holds the farmer also can easily withdraw cash from his account by using the m pesa attendant s or agent s number provided at the outlet and a personal pin special considerationsthrough mobile payment services like m pesa market traders debt collectors farmers and cab drivers don t need to carry around or transact in large amounts of cash this means that the occurrence of theft robbery and fraud can be reduced also individuals and business owners don t have to wait in long lines for hours to make their electricity and water bill payments because these can be made using m pesa using m pesa allows small business owners in remote and rural areas to conduct financial transactions safely and easily via their mobile phones to combat fraud m pesa is regulated by the appropriate offices of each country where it is offered to register for an m pesa account users must provide a government id and any other information such as a home address required by the government where they live this way each transaction is marked with the identification of the party transferring paying depositing or withdrawing money from an account 2