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Byline: SCOTT JOHNSON
Cell phones have been booming in Africa for years, but Susie Lonie has bigger ambitions. Lonie ran a pilot program for Vodafone in Kenya that turns the cell phone into a device for transferring funds. With M-Pesa (Swahili for "mobile money"), anybody with a phone and an account can send and receive funds with about as much effort as it took to write this sentence. In Kenya, where M-Pesa was officially launched three months ago, people are using phone money to buy goods and services from each other.
Many Kenyans--and most Africans--still do not have bank accounts. The costs of moving money through traditional institutions like Western Union can be prohibitively expensive. M-Pesa's virtual money, by contrast, is tied to real money held in the user's account and transferred for a small commission. So far the program has proved remarkably versatile. When one man was robbed during the pilot program, his wife sent him bus fare. Kenyan ministries are moving to allow users to pay electricity and water bills via cell phone.
More than 65,000 users have already registered for M-Pesa with Safaricom, Kenya's largest telecom firm. Vodafone plans to expand its network of 450 agents in Kenya to 5,000 by March. It's also targeting ...