Capital FM (Nairobi)

Kenya: CBK Wants Mobile Money Transfers More Secure

Nairobi, Kenya — The Central Bank of Kenya (CBK) could soon start monitoring money transfer transactions to ensure that the platforms are secure.

Speaking at the Africa Mobile Money Research Conference (AMMRC) in Nairobi on Monday, Information and Communications Permanent Secretary Bitange Ndemo said the mobile money transfer platforms could easily fall victim of the ongoing cyberspace crime if left unchecked.

He said the government was working on a platform that will have tighter security checks to safeguard mobile money transactions.

"The government is spending a lot more money and focus on cyber security because we have not had virtual IDs, which would help the transfer of money beyond where we've been," he revealed.

"Virtual IDs can easily be managed in terms of securing money transfers and we're now working on developing the public key infrastructure, which is much more secure," he added.

Mobile money transfer services in Kenya currently operate without a concrete governing policy, although the CBK has been working on draft policies which could be anchored in law.

In the latest draft, the CBK seeks to conduct annual reviews of all transactions to ensure that the systems are not abused and Ndemo disclosed that the process of digitalising all government registries to make them more efficient was still ongoing.

He emphasised the importance of exploiting the mobile platform for financial transactions to limit corruption.

"We now want to start providing services in public offices through mobile platforms. This will help us in cutting down on cases of corruption since all transactions will be easily traceable," he said.

"Any economy that successfully uses a large amount of cash also brings with it a lot of corruption and money laundering, and these are issues that the government is looking to deal with by looking at proper mechanisms to implement a cashless society," he confirmed.

Professor Tavneet Suri from the Massachusetts Institute of Technology in the US lauded the speed of adoption of mobile money transfer in Kenya saying the country should now roll-out other applications that will facilitate transactions for the low income groups.

"Mobile money has allowed people to save and transact in a more efficient and cost effective way that we didn't have before," she stated.

"It has been a big source of improved risk sharing and it will continue to have large positive consequences for people at the bottom of the pyramid," she said.

The University of Nairobi is hosting the two-day conference, which is aimed at developing more relevant mobile applications to boost the financial transactions of lower income earning Kenyans.

University of Nairobi Professor Timothy Waema warned that unless there is a joint collaboration between academia and industry players, the benefits of mobile money technology will not be fully enjoyed at the lower levels of society.

"There is definitely a gap between what happens within research institutions, what happens in government in terms of developing policy and what happens in the applications that are developed in the private sector to solve problems," he acknowledged.

"We want to bring together what is commonly referred to as the "triple helix", which consists of academia, public sector and the private sector working together so that we can create relevant products for developing this country," he explained.

Kenya has enjoyed much success in mobile money applications, but the usage has been limited to money transfers.

Waema blamed the slow uptake of mobile money applications to the knowledge gap between the industry and consumers, noting that despite Kenya having 15 million mobile customers, 99 percent use mobile money to send cash while only one percent carries out other financial transactions on the platform.

"There are many innovations out there but they are not being scaled down to the users appropriately. We need to bridge this gap by synchronising our expertise," he noted.

The conference at the Kenya School of Monetary Studies features researchers and industry players from Africa, the US, Europe, Australia and India and Waema said that the collaborations, facilitated by the government and development partners, will help to conceptualise new models which will add value to users.

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