CIO EAST AFRICA.
Safaricom's M-Pesa is giving Bitcoin - a worldwide peer-to-peer payment system introduced as open-source software - a run for its money in terms of the number of customers reached as well as volume of transactions.
According to a recent blog post Tim Swanson, Of Numbers blog, even though Bitcoin is a worldwide service and M-Pesa a regional service (found in Kenya and Tanzania), the latter solution which was pioneered in Kenya is seemingly doing better.
In his comparision, Swanson has posted a chart that further demonstrates Bitcoin's sluggish adoption. The chat shows worldwide transaction volumes of the digital currency compared with those in M-Pesa, currently considered the best lone success story among emerging-market mobile payments processors.
M- Pesa was launched in 2007 for Safaricom and Vodacom, the largest mobile network operators in Kenya and Tanzania. Bitcoin on the other hand, was launched in 2009 without such support - Bitcoin only had angel and VC investment getting involved on a later date.
Another article by Rob Wille in Business Insider, states thus: "Despite its global reach, Bitcoin flows now pale in comparison to those among Kenya's 45 million people over the course of their six-odd years in existence."
It further adds: "You could argue this is not a fair comparison. Bitcoin was started in the functional equivalent of a guy's basement, with angel and VC investment only taking off in the past year. M-Pesa had from Day 1 the backing of a telecom conglomerate, Vodafone. Even so, M-Pesa had about a 12-month period of growing pains, yet is now the medium through which 43% of Kenyan GDP passes."
M-PESA is operated by Safaricom and Vodacom and serves more than 30 million users in East Africa (Kenya and Tanzania), the Middle East and India. 43% of Kenya's GDP flows through the M-PESA system.
Swanson further states that "Bitcoins are not currently fulfilling the role of both a store of value and a medium of exchange" adding that "If one builds a tool that has few immediate uses besides gambling then it should not be surprising that mostly gamblers use it."