CC image courtesy of Raidarmax
The Central Bank of Kenya (CBK) and the Communications Commission of Kenya (CCK) have defended the government over regulations that allow them to closely monitor mobile money transactions.
CBK governor Njuguna Ndung’u said the emphasis was on enforcing better regulation to encourage innovation. He said tight controls had saved the country’s financial system from a potential blacklist after it was warned were not in line with anti-money laundering and terrorism financing laws.
“All regulations are aimed at enhancing synergies with agency banking model and bringing down unit cost of transactions,” he told the fifth global mobile money for the unbanked leadership forum in Nairobi.
“If we don’t do that, no one will come into the market.”
However the CCK and CBK admitted they had not kept pace with the mobile money business since the innovation was unexpected and its growth rate has been rapid.
Players in the industry have a different view about the new regulations. Safaricom chief executive officer (CEO) Bob Collymore, whose company’s mobile money platform transacts about KSh2.5 billion (US$29.4 million) a day, said Safaricom’s success prevailed on “smart regulatory environment and not restrictive regulations. There’s no end to creativity in this industry but we need less and better regulations because there exists huge untouched market.”
Mobile money was introduced in Kenya in 2007, and mobile phone based transactions across all networks reached KSh425 billion (US$5 billion) in the first three months of 2013, with over 21.1 million subscribers.
