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By Robert Bell, John Jung, Louis Zacharilla: Intelligent Communities are those which have - whether through crisis or foresight - come to understand the enormous challenges of the Broadband Economy, and have taken conscious steps to create an economy capable of prospering in it. They are not necessarily big cities or famous technology hubs. They are located in developing nations as well as industrialized ones, suburbs as well as cities, the hinterland as well as the coast.

How Did 17 Million Kenyans Exchange $20 Billion Last Year?

February 5, 2014 By

In 2013, the people of Kenya sent each other US$19.6 billion in payments and money transfers.  According to Herbert Wattanga, author of Nairobi County’s Smart21 nomination, the total of their transactions exceeded Kenya’s national budget by more than $1 billion.  And guess what?  Not one of those transactions went through a bank. Instead, all of them went through mobile phones.    

At ICF, we write a lot about the impact of the broadband revolution on every aspect of our lives, and about the urgent need it creates for cities and regions to adapt to its demands.  You would be hard-pressed to find a better example than mobile banking in Kenya – even though it uses a technology many years older than smartphones.


In 2007, a mobile carrier called Safaricom introduced a new money transfer service called M-Pesa.  Up to that point, banking in Kenya was largely controlled by foreign banks, which tended to serve only the most affluent Kenyans.  Then the central bank rewrote its regulations in an attempt to expand access to financial services.  One new regulation allowed mobile operators like Safaricom to provide mobile payments.  

Safaricom’s move was meant to be business-as-usual: a new service that would help reduce customer churn. It allowed users to load money onto their phones through the same process they used to prepay for airtime.  Money was moved with a simple text message, with each transfer incurring a fee of between $0.25 and $0.70.   The money deposited was held, not by banks, but in an independent trust that Safaricom does not control.

Business-as-usual it was not.  By 2012, there were 17 million M-Pesa accounts generating nearly US$300 million in fee income for Safaricom.  And Safaricom’s success pales in comparison to that of Kenya.  With 70 percent of adult Kenyans – and 50% of the poor – using it, The Economist estimates that M-Pesa has boosted national GDP by as much as 25 percent.  So popular has the service been that it drove an overall increase in mobile penetration from 49% in 2008 to 77% in 2012 – and greater phone penetration alone has generated $2.4 trillion in economic growth, according to a report by Deloitte (Mobile Telephone and Taxation in Kenya 2011).

So if you ever wonder what all the fuss about broadband is really about, M-Pesa offers a clue.  Sure, it’s not broadband – but it is a revolution in online applications.  It makes clear that the same technology bringing you you cute cat videos and spam in your inbox can profoundly change lives – but only in places that are prepared to seize the benefits technology offers.

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About the Intelligent Community Forum
The Intelligent Community Forum is a think tank that studies the economic and social development of the 21st Century community. Whether in industrialized or developing nations, communities are challenged to create prosperity, stability and cultural meaning in a world where jobs, investment and knowledge increasingly depend on advances in communications. For the 21st Century community, connectivity is a double-edge sword: threatening established ways of life on the one hand, and offering powerful new tools to build prosperous, inclusive and sustainable economies on the other. ICF seeks to share the best practices of the world's Intelligent Communities in adapting to the demands of the Broadband Economy, in order to help communities everywhere find sustainable renewal and growth. More information can be found at

Robert Bell
Robert Bell is co-founder of the Intelligent Community Forum, where he heads its research and content development activities. He is the author of ICF's pioneering study, Benchmarking the Intelligent Community, the annual Top Seven Intelligent Communities of the Year white papers and other research reports issued by the Forum, and of Broadband Economies: Creating the Community of the 21st Century. Mr. Bell has also authored articles in The Municipal Journal of Telecommunications Policy, IEDC Journal, Telecommunications, Asia-Pacific Satellite and Asian Communications; and has appeared in segments of ABC World News and The Discovery Channel. A frequent keynote speaker and moderator at municipal and telecom industry events, he has also led economic development missions and study tours to cities in Asia and the US.

John Jung
ICF co-founder John G. Jung originated the Intelligent Community concept and continues to serve as the Forum's leading visionary. Formerly President and CEO of the Greater Toronto Marketing Alliance and Calgary Economic Development Authority, he is a registered professional urban planner, urban designer and economic developer. He leads regular international business missions to US, European, Asian, Indian and Australian cities, and originated the ICF Immersion Lab program. John is a regular speaker at universities and conferences and serves as an advisor to regional and national leaders on Intelligent Community development. The author of numerous articles in planning and economic development journals, he has received global and Toronto-based awards for his work in collaboration and strategic development and sits on numerous task forces and international advisory boards.

Louis Zacharilla
ICF co-founder Louis Zacharilla is the creator and presenter of the annual Smart21, Top Seven and Intelligent Community Awards and oversees ICF's media communications and development programs. He is a frequent keynote and motivational speaker and panelist, addressing audiences of tech, academic and community leaders around the world, and writes extensively for publications including American City & County, Continental Airline's in-flight magazine and Municipal World. His frequent appearances in the electronic media have included both television and radio in South Korea, China and Canada. He has served as an adjunct professor at Fordham University in New York and is a Guest Lecturer at Polytechnic University's Distinguished Speaker Series. He holds a Masters Degree from the University of Notre Dame.