In Innovations, less than two years ago, Nick Hughes and Susie Lonie described how they conceptualized, piloted and, in 2007 launched, M-PESA, an award-win- ning money transfer technology based on mobile phones. 1 Much has happened since then. This article looks further into what happened next, focusing on the local con- text and commenting on what the future might hold. I will try to demonstrate that besides the simple and innovative product, the characteristics of the local mobile telephony and banking sectors contributed greatly to the successful adoption and diffusion of the money transfer service. This is a good example of a service whose time had come and whose implementation occurred in the right context. ABOUT KENYA Kenya, considered an economic hub of East Africa, lies astride the equator. Tanzania lies to the south and Uganda to the west; to the southeast lies over 3300 miles of Indian Ocean coastline. In 2007, Kenya’s population was estimated at 36,913,721 and its growth rate at 2.8%. More than a third of the population lives in urban areas; Nairobi, the capital, is the largest city, with approximately 3,000,000 people. 2 Like people in many emerging markets, most Kenyans are not used to making electronic payments. At the national level, most transactions are in cash. A survey © 2009 Tonny Omwansa innovations / Mobile World Congress 2009 107 Tonny Omwansa M-PESA: Progress and Prospects Innovations Case Discussion: M-PESA Tonny Kerage Omwansa is a lecturer at the Faculty of Information Technology at Strathmore University in Nairobi, Kenya. He holds a BSc. in Computer Science from Nairobi, Kenya and MSc. Computer from Kansas, USA. Besides consultancy in tech- nology issues, he has done extensive research in Mobile Transactions in Africa and published various reports including use of airtime transfers, mobile banking, virtual currencies as well as regulation of mobile transactions. His research interests are in mobile transactions, socio-economic impacts of technologies in emerging economies and role of technology in regulation. He is enrolled for a PhD pursuing economics of technology with an emphasis on regulation.