Kenyan banks’ mobile money plans fails to take off

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Two missed deadlines in Kenya and uncertainty on when local banks will roll out their interbank switch allowing direct mobile money transfer through mobile phones across the industry has dampened the prospects of the entire plan.

The move to establish the Real Time Interbank Switch, which has already fallen five

Kenyan banks' mobile money plans fails to take off
Kenyan banks’ mobile money plans fails to take off

months behind schedule, now stands on a shaky ground after a second roll-out timeline elapsed without a word from banks.

A number of lenders have been going through financial turmoil and have consequently been entering into partnerships with telcos while some have since set up their own mobile networks. These developments have thrown cold water on the Sh700 million joint initiative first mooted in 2012.

Kenya Bankers Association (KBA), which is spearheading the plan that was set to go live in November 2015, denies it has been shelved.KBA Chief Executive Habil Olaka who had given April as the new date for the system to start operating declined this time to give any possible roll-out timelines only maintaining that the plan is “on course”‘

“The plan has not been shelved at all, we are just moving step by step and various banks are at various stages of system adjustments to facilitate the project. We are currently carrying out User Acceptance Tests and we will soon start piloting before we roll it out in the shortest time possible,”Mr Olaka told Smart Company .

“This is our own innovation and banks identified the gap in money transfer including the amounts involved as well as costs and that is the solution we intend to provide.”

Earlier, Mr Olaka had also admitted to the emergence of some “new areas of concern” that needed to be addressed causing the delay in roll out of the plan.

Banks contacted by Smart Company for comments on the matter kept a tight lip only saying KBA is handling the issue.

“Apologies for the delayed response, the bank feels these question should be answered by KBA as it’s their initiative and all banks are required to comply,” came an email reply from one of the top three lenders.

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