How Nairobi’s Matatus Defied the Will of Kenya’s Cashless Policy Makers

Nairobi’s failed cashless experiment, an attempt to digitize all commuter payments in Kenya is a poster child on the pattern of thinking that’s left a trail of struggling Fintech experiments in the name of Silicon Savannah.

 

We often fall into the trap of making broad sweeping assumptions about people and places based on our preconceived notions of an what we consider is an ideal world. In the context of East Africa and its bulging informal economy, countless technology entrepreneurs, policy makers, donor agencies and wazungu NGOs have fallen victim to throwing resources at reality hoping to turn it into their Utopian dream. Pick a sector, any sector – be it agriculture, transport, banking, ecommerce. Everything but the kitchen sink has been tried at perceived problems. I say perceived because the definition of the problem depends on who you ask.

Kenya’s short innovation history is littered with such experiments, typically ambitious, well funded but not lasting long before packing up.

Nairobi’s failed cashless experiment, an attempt to digitize all commuter payments in Kenya is a poster child on the pattern of thinking that’s left a trail of struggling Fintech experiments in the name of Silicon Savannah.

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How The Chinese, Africa’s Most Popular Browser , And A Bitcoin Mining Company Are About To Change African Payments

Africa’s most popular mobile browser, Opera is about to radically change the payments landscape in Africa.

China Loves Africa 2 by Michael Soi
Michael Soi’s China Loves Africa Collection

I think before this blog and thread, the global cryptocurrency community will not appreciate the strategic relevance of Bitmain’s $50 million investment round into one of Africa’s most popular Chinese owned mobile browser, Opera. What they will not see is the Fintech connection at play in East Africa, where the wildly successful mobile browser is creeping into digital financial services like mobile payments. For the payment professionals of East Africa, the pertinence of this investment on the future of their industry will not dawn on them perhaps until it is too late.

Last week’s SEC’s disclosure on Opera’s newest investor for their $115 million IPO, was the best strategic news on cryptocurrency ‘adoption’ in Africa I have seen in the last 5 years with far reaching implications on e-commerce, trade and payments for the region than appears at first glance.

My choice of a header image above accurately captures increasing Chinese influence on Kenya and Africa, at both state and commercial level.

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How the Central Bank Of Kenya Plans To Regulate Bitcoin and Cryptocurrencies

Rather than fight change, the Central Bank of Kenya now seems to be reconsidering its stance on cryptocurrencies as a radically new way of high-speed, low-cost value transfer independent of traditional financial intermediaries.

Bitcoin and cryptocurrencies are a puzzle especially for regulators. Over the last 4 years our dear Central Bank Governor, Dr. Patrick Njoroge has consistently been opposed to the idea of cryptocurrencies. He issued 2 damning public notices warning the public to stay away and another circular expressly requesting banks to choke any value transfer activity related to cryptocurrencies.

As per the Central Bank of Kenya Act, he is well within his right. A bank is a regulated private business. You cannot compel a bank to take you as a customer or take your business. Thus, every once in a while, the governor pulls out his trump card to remind us who is boss.

But mounting pressure has pinned the old man against the wall, forcing him to revisit his dogmatism. An article from the Standard dated May 23rd titled “CBK Warms Up to Cryptocurrencies”  read

“CBK Governor Patrick Njoroge said the regulator was open to introducing cryptocurrencies such as bitcoin as alternative payment vehicles with the opportunity to reduce fraud.”

While in the past, all the the financial instruments that intermediary companies use for fund transfers were based on fiat currencies, in the forms of cash, bank deposits and electronic money – it is no longer the case with the advent of Bitcoin.

Rather than fight change, the Central Bank of Kenya now seems to be reconsidering its stance on cryptocurrencies as a radically new way of high-speed, low-cost value transfer independent of traditional financial intermediaries.

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5 Types of Pesa We Use in Kenya Today

Pesa is dynamic. We need look no further than Nairobi for 5 types of pesa in Kenya you’re likely to have come across.

Pesa is dynamic.

One of my favorite projects in Kenya is Bangla Pesa. Besides being greatly underappreciated as an example of how to empower rural and informal communities, its perception is a great example of the miseducation of pesa. Back in 2013 the members of this community currency project were arrested and paraded in the media as secessionists out to overthrow the national government.

Of course it was but a clear case of misunderstanding, like so many out-of-the-box ideas in Kenya.

When thinking about pesa, you gotta loosen up. We need look no further than Nairobi for 5 types of pesa in Kenya you’re likely to have come across.

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How to think about pesa in Kenya

How many of us think deeply about the pesa we use everyday? Here are 9 lenses we can look through to analyze all the pesa we use in Kenya today.

How many of us think deeply about the pesa we use everyday? In my experience, only a handful of us are conscious of the nuances of our day to day pesa. Yet, Kenya has one of the most colourful pesa diversity in the world. Bangla pesa, bonga points, Mpesa, Chama Pesa, Bitcoin, Cash and airtime are all part of Kenya’s money montage.

Here are 9 lenses we can look through to analyze all the pesa we use in Kenya today.

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