Kenya is a country in South Africa. The capital of Kenya is Nairobi and has a population of about 45,010,056. Swahili and English are the country’s official languages. Kenya is famous for its vast wildlife preserves.
A recent trend has been observed in this 48th largest country in the world. They lead the world with mobile money rather than cash. Every one of four adults in Kenya is preferring mobile money over cash. Mainly during the COVID-19 outbreak, almost every individual preferred digital mode of payments. The Government is seeking pandemic as an opportunity for making use of mobile money dominant. One company that is also helping people move towards mobile money is Safaricom MPESA. The Safaricom MPESA charges are so cheap that everyone is now able to afford using mobile money in Kenya. Although all countries of the world have shown their interest in online ways of methods, Kenya stands out in going cashless.
Here are 5 reasons for Kenya to go cashless:
1. To Avoid Contact: Since the whole world is suffering from the coronavirus outbreak, it has become crucial to avoid coronavirus risk in every conceivable way. Using cash makes people come in contact through paper money. This potentially increases the spread of the virus. Once this virus infects, an individual or his/her whole family can be infected, leading to an increase in the death rate. Also, the virus is highly communicable, and as of now, no vaccine is available in the market. It becomes even more important to hinder the range of the COVID. Digital payments permit people to make payments maintaining social distancing, promoting citizens to reduce contact with the virus. It empowers them to pay their bills through facial recognition, fingerprint scanner, or by the simple use of passwords, avoiding every potential way of coming in contact. Thus, the Government is promoting the use of digital payments to counter the spread of coronavirus. Digital payment is a secure and simple way to make payments through mobile, thus avoiding every possible contact.
2. Helps in easy monitoring of Country’s Capital: For any digital transaction, one’s account must be linked to a verified bank. All the personal details are meant to be submitted. This is so because digital payments not only permit an individual to make payments but also authorizes him/her to store money in digital wallets. There is no chance of having a fraud bank account because the confirmation in linking a bank account includes several steps. Transaction while sending money in another is a bank account, purchasing new products, etc. generates transaction history for an individual account. All the transaction history is being saved in the central bank of the country. This helps in easy monitoring of the money. The records empower the Government to block illegal transactions, fraud money transfer, money-hoarding, and tax evasion. When the total population uses digital payments, this ensures the verification of every citizen of the country.
3. Generates Empowerment: This is one of the biggest reasons for many countries, especially Kenya, to switch to digital payment methods. When the payments become digital, every citizen is bound to submit their official details. The number of family members, monthly income of the family, age of every living member are some of the details. This way, the Government can easily make out citizens living above and below the poverty line. Also, the Government can identify how many citizens are unemployed or underemployed. This encourages the Government to take necessary actions regarding citizen interest. The changes to be brought in government policies can be detected by governmental bodies. Most importantly, digital payments empower women of a house. For online payments, money is meant to be stored in digital wallets, ensuring women get access to financial services and salaries. The safety and empowerment of women is a huge concern for every country. Having a digital account not only makes women feel confident but also gives them the security of their own money.
4. Simple, Fast, and Secure Transaction: Before the era of digital payments, old and traditional methods were used to transfer money. Traditional payments not only take time, but it is also very risky for making huge payments. It becomes even more troublesome and disturbing when it becomes mandatory to travel with a large amount of cash. Also, it seems impossible to make instant payment with traditional methods when the receiver is sitting kilo miles away from the payer. Digital payment overcomes all the shortcomings of the old methods of payments. Online transaction is much simpler than an offline mode of payment. It gives you access to make payments from the comfort of your living room. Digital payment methods are a million times faster than traditional methods. It is not only simple but also instant. The payer can make payments to a person sitting miles away from him within a few seconds. With all its special benefits, it is highly secured and verified. A person needs to carry a large amount of cash in his/her pocket, making them feel unsafe. Thus, having access to digital payment methods leads to the advancement of all residents living in a country.
5. Financial Inclusion: It is the availability and equality of opportunities to access financial services. It removes barriers such as net worth or company size and makes products and services available and accessible to all individuals. Digital payments made it possible for every resident to get access to financial inclusion. Also, it assists the Government as they need not transfer money to poor people via governmental bodies since digital payments allow direct access to ones’ bank account. It not only eradicates corruption but also aids in the growth of the rural population of the country. It also generates trust between the Government and its citizens and promotes residents to go for secured loans. A Survey in Kenya showed that before digital payments, farmers who were not able to or were uninterested in investing in their crops are now confident and somewhat willing to invest in their crops. This is possible because of the direct contact between the Government and its people.
Thus, the epoch of digital payments comes with a lot of its benefits and usages, which directly aids in the growth of the country. So far, Kenya has reached a point where its residents are also interested in knowing more about digital payments, and the majority of their population is using it also.