Bankers are not well known for giving riveting talks. However, Stephen Mwaura Nduati gave a surprisingly interesting one here at the Mobile Banking conference just outside Nairobi. He’s in charge of “Payment Systems” at the Central Bank of Kenya – a regulator.
He made the case for why regulation is needed, and what risks are naturally inherent within payment systems. Not just mobile payments, but all systems.
What I was most interested in was his slides giving out some data on the payment system space within Kenya. It’s really quite revealing on what the motives are, and why they’re there, for the Central Bank and policy makers.
Kenya’s payment system timeline
You can see where Mpesa and Zap came into the timeline for payment systems in Kenya, but you can also see that it’s quite clear that the Central Bank of Kenya (CBK) thinks of many things beyond mobile payments.
Low vs high volumes
Mobile payments are all the rage, clearly shown in the graph below. However, the amount of money flowing through the system from this is negligible compared to the other types of payments. There is a large difference between high volume systems versus where a lot of money flows, but with fewer transactions.
Current payment system flows
Low volume, high value. These are what the CBK care about. Taking a look at the following two slides, you can see that though mobile payments and ATMs are what everyone talks about, what the bank really cares about making sure that the real time gross settlement (RTGS) system stays on the tracks.