A mobile banking service is transforming how the poor transfer money — here’s how it works

In 11 countries around the world, some 30 million people use a mobile money service that is transforming how people handle their finances.

It’s called M-Pesa, and it has lifted hundreds of thousands of people out of poverty in Kenya.

"Pesa" is Swahili for money. The Kenyan service provider Safaricom launched M-Pesa in the East African nation 10 years ago, and since then it’s enabled countless people to move small amounts of their own money and send it to others.

On a recent trip to Kenya, I got a firsthand look at how M-Pesa works on the ground.

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GiveDirectly is a charity that delivers cash right to people’s mobile phones. Agrippa Agida Onywero Krispo is one such recipient.

Krispo, 40, is enrolled in GiveDirectly’s experiment in basic income, a system of wealth distribution in which people receive a standard salary just for being alive.

The money comes with no strings attached. Krispo and the other villagers have received $22 a month since October 2016, and they’ll continue getting it until October 2028.

M-Pesa works similar to Venmo or PayPal —except you don’t need a smartphone or a bank account. GiveDirectly sends Krispo the monthly payment via his phone. He can use the app to withdraw, deposit, and send money.

When GiveDirectly sends the money between the 5th and 7th of each month, it’s just a few taps before Krispo can bring up the confirmation notice on his phone.

That screen lets him know the money was safely transferred to his M-Pesa account.

Scattered around town are M-Pesa stands, outfitted with live agents who can dispense money — essentially an ATM with a human teller.

This is one feature that sets M-Pesa apart from Venmo and PayPal, which can only sync with users’ bank accounts.

See the rest of the story at Business Insider

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