The evolution of Kenya’s informal sector agency

Mobile money human agent were one of the key pillars of Mpesa and mobile money success.

Today, human agents in Kenya, and Nairobi have evolved to cater for an increasing number of services: cash in cash out, banking service, prepaid utility.

Interestingly, the human agency form has also changed. It’s a ‘side’ business with commission revenues and walk in traffic that incentivises merchant’s to add it as a service or stand alone. Kiosk owners, cyber cafe’s, restaurants – almost any outlet will easily turn into an agent point.

I like this model and it seems a natural fit for the nature of our (Kenya’s) economy. What’s more, it gets people jobs or an alternative income stream versus say an ATM machine.  

Besides private sector services, government services are rolling out on this agency network and model. A cyber cafe acts as an agent point for electronic government services – like iTax, driver’s license renewal, and the early steps of online passport application. Again, it seems a seamless fit for pre-existing biashara. Just take a tour of Nairobi and observe the number of agents. Everywhere!

Even more interesting, is the emergence of online money forex exchange informal agency. Here is one for example, an instant PayPal to Mpesa withdrawal agent in Kenya. He offers Skrill and Payoneer exchange services. Again, a suit for Kenya’s biashara.

There is obviously *something* here about agency. Why is it such a natural fit?


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