Why isn’t Africa adopting Bitcoins massively for money-transfers?

Bitcoin adoption in Africa, not what you expect

Answer by Michael Kimani:

There’s a lot of variables in play before bitcoin can be used for money transfer on a significant scale. I’ll outline a few.

Regulation: A lack of regulatory clarity poses a challenge for widespread adoption.  Many African countries take years to pass legislation for payments and it can be hard for start-ups or new market entrants. Bitcoin requires supporting structures like exchanges to enable transfers. These structures can’t come up easily if the environment is not conducive.

Awareness/Misinformation: Right now, from the outside looking in, most people from Kenya for example, are highly skeptical. Some don’t know of it and others who’ve heard of it only  heard the bit about Silk Road and an anonymous guy named Satoshi. It’s abit complex for the average and even more than avergae individual from Kenya. You have to remember, people here have a whole different life going on. They don’t care much about what goes in another part of the globe.

Existing mobile money services: The need for money transfer was already conquered here, by the popular M-pesa in Kenya and other MM services in East Africa. It’s not the cheapest solution (compared to bitcoin) but it works fine and they’ve come to trust it. Largely due to intensive branding, marketing and PR by the service providers. It also helps that it has been backed by governments, authorities, the media and almost everyone as the holy grail! People are accustomed to what they’re used to.

Cash is King: A lot of transactions in Africa are carried out in cash. Credit cards haven’t fully penetrated here like they have in more advanced countries. So, high fees & charge backs for online payments isn’t exactly a major selling point here.

You can also see my answer to Why has M-Pesa been much more successful as a transaction currency in Africa, then Asia, than Bitcoin? I think you’ll find some of the points relevant for this question.

Very little is known of bitcoin in East Africa despite its ubiquitous mentions online. You wouldn’t believe it. To be fair, bitcoin is a bit complex concept to wrap your head around.

I can’t rule out the possibility that this will change in the  medium-long term as there are concerted efforts to change misconceptions and educate people. My thoughts for this answer are simply for this question. Beyond this question, I am positive the situation will change. I am actually advocating bitcoin in East Africa.

The Africa Digital Currency Association for example, is trying to address these challenges in East Africa.

Why isn’t Africa adopting Bitcoins massively for money-transfers?

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