Migrant Remittances in Africa: An Overview
35
2007 (Pulver, Jack, and Suri 2009; Joseph 2010; Mas and Radcliffe 2010). Surveys by Kenya’s Financial Sector Deepening (FSD) found that the most commonly used means of sending money within Kenya in 2006 were by hand (58 percent), bus (27 percent), post office and money order (24 percent), direct deposit (11 percent), and money-transfer service (9 percent). By 2008, M-PESA had come to dominate domestic remittances, with 47 percent of Kenyans using this service, while the share of remittances sent by hand and by transport companies decreased to 32 percent and 9 percent, respectively. Reliance on mobile-phone transfers dramatically reduced the need for domestic migrants to travel home to deliver money by hand or send it by bus or transport company. The use of mobile phones to transfer money has also enabled recipients to send smaller amounts of money but more often (and collectively more), in response to lower costs because of the greater accessibility of M-PESA agents. As figure 1.14 illustrates, the average transaction size decreased by 30 percent between March 2007 and March 2009 from 3,300 Kenya shillings (about $41 at prevailing exchange rates) to 2,300 Kenya shillings (about $29) (Morawczynski and Pickens 2009; Pulver, Jack, and Suri 2009). Mobile money-transfer services are now increasingly used for savings. More than one-fifth (21 percent) of respondents in the 2008 FSD survey reported using electronic money (e-money) on their mobile phones for storing or saving money for everyday use and for emergencies. Safaricom, Average M-PESA Transaction Size, March 2007–March 2009 50
average transaction, K Sh
3,500
45 40
3,000
35 30
2,500
25 2,000
l0 7 Se p 0 No 7 v0 7 Ja n 08 M ar 08 M ay 08 Ju l0 8 Se p 08 No v0 8 Ja n 09 M ar 09
07
Ju
ay M
M
ar
07
20
US$ Source: Pulver, Jack, and Suri 2009. Note: K Sh = Kenya shillings.
K Sh
average transaction, US$
Figure 1.14