What is mobile money? How phone-based wallets like M-Pesa work
By SendPay Business · · 2 min read
Mobile money is a wallet tied to a phone number, run by a mobile network or payment firm rather than a bank. It lets people send, receive, store and spend money from a basic phone. M-Pesa, launched by Safaricom in Kenya in 2007, is the best-known example, and mobile money is now used across Africa, Asia and beyond.
How it works
- The customer registers their phone number and passes identity checks.
- They pay cash in at a local agent, often a small shop, to top up the wallet.
- They send money to other phone numbers, pay bills or buy goods.
- They cash out at an agent, or move money to a bank account.
Why it matters
In many countries more people have a mobile money wallet than a bank account. For them, it's how wages are paid, bills settled and money received from family abroad.
What it means for transfer apps
Paying out to mobile money is often the fastest and cheapest way to get money to someone in countries where it's widely used. Transfer apps connect to it through payout partners in each country, so choosing partners that cover the right wallets matters as much as your exchange rate.
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This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.