Publications
Published on June 5, 2012

Time for cash to cash out? Scoping Kenya’s path to a cash-lite society

Download  
Summary

Cash is an expensive financial instrument. Because it is physical, it must physically change hands, be aggregated, moved over space, and protected from theft both in small and large values. All of this – transportation, processing time, security, and the need for physical storage – entails costs. Electronic payment systems represent what could be a dramatic upgrading of the basic infrastructure of commerce. Such systems could slash transaction costs on many different layers of economic activity, potentially yielding major gains for consumers, business owners, and the macro economy at large.

With cutting edge services, like M-PESA and agent banking, Kenya could be poised to make the transition to a “cash-lite” society. But to lay out a roadmap for that transition, we need to understand current payments patterns and how cash actually circulates geographically to identify opportunities to eliminate costs associated with heavier cash usage – notably its collection and movement in bulk, across large geographical distances.

You might also like

SME Trade Finance: Review of facilities available in Kenya

Testing SME banking in Kenya – a mystery shopping exercise

Financial exclusion in Kenya: An analysis of financial service use

Key findings from the 2015 FinAccess geospatial mapping survey

2015 FinAccess geospatial mapping survey: analysis and use cases

Towards positive selection in the Kenyan credit market