Payment News

Challenges of Financial Inclusion

A recent article in Kenya’s Star newspaper looked at why the informal transport system of ‘matatus’ (privately owned cars or minibuses acting as shared taxis) does not make use of M-Pesa wholeheartedly. It suggests two reasons.

First, it is possible to reverse a transaction if money has been sent incorrectly. The sender has to call customer care and give the details of the transaction. Many matatu operators are wary of being defrauded by people using this facility.

Second, M-Pesa offers its users a continuous overdraft facility known as Fuzila up to an agreed limit. It is a product of CBA Bank offered by Safaricom as part of its M-Pesa payment system. When users deposit money into their M-Pesa account, Safaricom reduces the overdraft plus a small facility fee or interest charge. The article says millions of Kenyans have significant debts from Fuliza and don’t want to receive money into their M-Pesa accounts where it is swallowed up repaying those debts, leaving them unable to withdraw cash.