IDEAS home Printed from https://ideas.repec.org/a/kap/revind/v60y2022i3d10.1007_s11151-022-09858-x.html
   My bibliography  Save this article

Competition and Regulation of Mobile Money Platforms in Africa: A Comparative Analysis of Kenya and Uganda

Author

Listed:
  • Anthea Paelo

    (University of Johannesburg
    Financial Sector Deepening Uganda)

  • Simon Roberts

    (University of Johannesburg
    University College London)

Abstract

We analyze the competition issues in mobile money in Kenya–where Safaricom is the market leader–and in Uganda: where the market is duopolistic. We evaluate the multi-sided platform characteristics that have underpinned the rapid growth of the lead mobile money platforms and that also imply that the market leaders have substantial market power and can act as gatekeepers. The conduct of the lead firms is assessed along with competition measures and regulatory interventions made in each country. The analysis highlights the importance of–and challenges for–competition enforcement in developing countries to ensure effective rivalry while realizing the gains from innovation in digital platforms.

Suggested Citation

  • Anthea Paelo & Simon Roberts, 2022. "Competition and Regulation of Mobile Money Platforms in Africa: A Comparative Analysis of Kenya and Uganda," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 60(3), pages 463-489, May.
    • Handle: RePEc:kap:revind:v:60:y:2022:i:3:d:10.1007_s11151-022-09858-x
    DOI: 10.1007/s11151-022-09858-x
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11151-022-09858-x
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s11151-022-09858-x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. J. Gregory Sidak & David J. Teece, 2009. "Dynamic Competition In Antitrust Law," Journal of Competition Law and Economics, Oxford University Press, vol. 5(4), pages 581-631.
    2. Jean‐Charles Rochet & Jean Tirole, 2006. "Two‐sided markets: a progress report," RAND Journal of Economics, RAND Corporation, vol. 37(3), pages 645-667, September.
    3. Lamoreaux, N., 2019. "The Problem of Bigness: From Standard Oil to Google," Cambridge Working Papers in Economics 1963, Faculty of Economics, University of Cambridge.
    4. Marc BOURREAU & Tommaso VALLETTI, 2015. "Competition and Interoperability in Mobile Money Platform Markets: What Works and What Doesn’t?," Communications & Strategies, IDATE, Com&Strat dept., vol. 1(99), pages 11-32, 3rd quart.
    5. Naomi R. Lamoreaux, 2019. "The Problem of Bigness: From Standard Oil to Google," Journal of Economic Perspectives, American Economic Association, vol. 33(3), pages 94-117, Summer.
    6. William Jack & Tavneet Suri, 2014. "Risk Sharing and Transactions Costs: Evidence from Kenya's Mobile Money Revolution," American Economic Review, American Economic Association, vol. 104(1), pages 183-223, January.
    7. Gutierrez, Eva & Singh, Sandeep, 2013. "What regulatory frameworks are more conducive to mobile banking ? empirical evidence from findex data," Policy Research Working Paper Series 6652, The World Bank.
    8. Jenny C. Aker & Isaac M. Mbiti, 2010. "Mobile Phones and Economic Development in Africa," Journal of Economic Perspectives, American Economic Association, vol. 24(3), pages 207-232, Summer.
    9. Michael L. Katz & Carl Shapiro, 1994. "Systems Competition and Network Effects," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 93-115, Spring.
    10. Klein, Michael & Mayer, Colin, 2011. "Mobile banking and financial inclusion: The regulatory lessons," Frankfurt School - Working Paper Series 166, Frankfurt School of Finance and Management.
    11. Adeline Pelletier & Susanna Khavul & Saul Estrin, 2020. "Innovations in emerging markets: the case of mobile money," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 29(2), pages 395-421.
    12. Doganoglu, Toker & Wright, Julian, 2010. "Exclusive dealing with network effects," International Journal of Industrial Organization, Elsevier, vol. 28(2), pages 145-154, March.
    13. Isaac Mbiti & David N. Weil, 2015. "Mobile Banking: The Impact of M-Pesa in Kenya," NBER Chapters, in: African Successes, Volume III: Modernization and Development, pages 247-293, National Bureau of Economic Research, Inc.
    14. Munyegera, Ggombe Kasim & Matsumoto, Tomoya, 2016. "Mobile Money, Remittances, and Household Welfare: Panel Evidence from Rural Uganda," World Development, Elsevier, vol. 79(C), pages 127-137.
    15. Janine Aron, 2018. "Mobile Money and the Economy: A Review of the Evidence," The World Bank Research Observer, World Bank, vol. 33(2), pages 135-188.
    16. Ky, Serge Stéphane & Rugemintwari, Clovis & Sauviat, Alain, 2021. "Friends or Foes? Mobile money interaction with formal and informal finance," Telecommunications Policy, Elsevier, vol. 45(1).
    17. William Jack & Tavneet Suri, 2011. "Mobile Money: The Economics of M-PESA," NBER Working Papers 16721, National Bureau of Economic Research, Inc.
    18. Tyce, Matthew, 2020. "Beyond the neoliberal-statist divide on the drivers of innovation: A political settlements reading of Kenya’s M-Pesa success story," World Development, Elsevier, vol. 125(C).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Aurazo, Jose & Gasmi, Farid, 2024. "Digital payment systems in emerging economies: Lessons from Kenya, India, Brazil, and Peru," TSE Working Papers 24-1572, Toulouse School of Economics (TSE).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Serge Ky & Clovis Rugemintwari & Alain Sauviat, 2018. "Does Mobile Money Affect Saving Behaviour? Evidence from a Developing Country," Journal of African Economies, Centre for the Study of African Economies, vol. 27(3), pages 285-320.
    2. Ky, Serge Stéphane & Rugemintwari, Clovis & Sauviat, Alain, 2021. "Friends or Foes? Mobile money interaction with formal and informal finance," Telecommunications Policy, Elsevier, vol. 45(1).
    3. Manuela NGABA, 2021. "How does mobile money affect the use of informal remittance channels in Sub-Saharan Africa?," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 53, pages 123-146.
    4. Lashitew, Addisu A. & van Tulder, Rob & Liasse, Yann, 2019. "Mobile phones for financial inclusion: What explains the diffusion of mobile money innovations?," Research Policy, Elsevier, vol. 48(5), pages 1201-1215.
    5. Leo Van Hove & Antoine Dubus, 2019. "M-PESA and Financial Inclusion in Kenya: Of Paying Comes Saving?," Sustainability, MDPI, vol. 11(3), pages 1-26, January.
    6. Osabutey, Ellis L.C. & Jackson, Terence, 2024. "Mobile money and financial inclusion in Africa: Emerging themes, challenges and policy implications," Technological Forecasting and Social Change, Elsevier, vol. 202(C).
    7. Ahmad Hassan Ahmad & Christopher Green & Fei Jiang, 2020. "Mobile Money, Financial Inclusion And Development: A Review With Reference To African Experience," Journal of Economic Surveys, Wiley Blackwell, vol. 34(4), pages 753-792, September.
    8. Pelletier, Adeline & Khavul, Susanna & Estrin, Saul, 2019. "Innovations in emerging markets: the case of mobile money," LSE Research Online Documents on Economics 101150, London School of Economics and Political Science, LSE Library.
    9. Pelletier, Adeline & Khavul, Susanna & Estrin, Saul, 2019. "Innovations in emerging markets: the case of mobile money," LSE Research Online Documents on Economics 101585, London School of Economics and Political Science, LSE Library.
    10. Chiara, De Gasperin & Valentina, Rotondi & Luca, Stanca, 2019. "Mobile Money and the Labor Market: Evidence from Developing Countries," Working Papers 403, University of Milano-Bicocca, Department of Economics, revised Mar 2019.
    11. Miyajima, Ken, 2022. "Mobile phone ownership and welfare: Evidence from South Africa’s household survey," World Development, Elsevier, vol. 154(C).
    12. Beck, Thorsten & Pamuk, Haki & Ramrattan, Ravindra & Uras, Burak R., 2018. "Payment instruments, finance and development," Journal of Development Economics, Elsevier, vol. 133(C), pages 162-186.
    13. Riley, Emma, 2018. "Mobile money and risk sharing against village shocks," Journal of Development Economics, Elsevier, vol. 135(C), pages 43-58.
    14. Ahmed, Haseeb & Cowan, Benjamin, 2021. "Mobile money and healthcare use: Evidence from East Africa," World Development, Elsevier, vol. 141(C).
    15. Avom, Désiré & Bangaké, Chrysost & Ndoya, Hermann, 2023. "Do financial innovations improve financial inclusion? Evidence from mobile money adoption in Africa," Technological Forecasting and Social Change, Elsevier, vol. 190(C).
    16. Grzybowski, Lukasz & Lindlacher, Valentin & Mothobi, Onkokame, 2023. "Mobile money and financial inclusion in Sub-Saharan Africa," Information Economics and Policy, Elsevier, vol. 65(C).
    17. Seng, Kimty, 2021. "The mobile money’s poverty-reducing promise: Evidence from Cambodia," World Development Perspectives, Elsevier, vol. 22(C).
    18. Koomson, Isaac & Bukari, Chei & Villano, Renato A, 2021. "Mobile money adoption and response to idiosyncratic shocks: Empirics from five selected countries in sub-Saharan Africa," Technological Forecasting and Social Change, Elsevier, vol. 167(C).
    19. Luc Jacolin & Joseph Keneck Massil & Alphonse Noah, 2021. "Informal sector and mobile financial services in emerging and developing countries: Does financial innovation matter?," The World Economy, Wiley Blackwell, vol. 44(9), pages 2703-2737, September.
    20. Christian Lambert Nguena, 2019. "Working Paper 323- Mobile Financial and Banking Services Development in Africa," Working Paper Series 2449, African Development Bank.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:revind:v:60:y:2022:i:3:d:10.1007_s11151-022-09858-x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.