I was giving a presentation recently when I asked "What's the most digitally advanced country in the world?" The answers I got ranged from Japan to Sweden to the US. Everyone looked pretty surprised when I said Kenya.
And yet while the West has been trying to develop the right platforms and technology for mobile payments to work, and technology providers and operators have been battling for mobile payment supremacy, Kenya has gone straight from a barter/gift/debt economy to digital transaction - leapfrogging over the last 100 years of the West's progress in monetary transactions.
For the last five years, a digital revolution has transformed the lives of businesses and individuals in Kenya, who have been happily transacting via their mobile through money transfer service, M-PESA, which was set up in 2007 by Kenyan telco Safaricom and developed by its owner, Vodafone.
Specifically designed for people without a bank account, the service was the first of its kind in the world, and now has over 15 million users - 75% of Kenya's adult population. Kenyans can also now pay for their goods in the supermarket via the M-PESA service - allowing cashless payments at the till for people that don't have access to conventional banking.
Has this been a wake-up call to the West? Well, now we are copying how the supposedly 'under developed' world is transacting - emulating what has been happening in general terms in Kenya for five years. Look at the launch of Barclay's Pingit service this year, which allows people to send or receive up to £300 a day via a smartphone app. Pingit is purely a money transfer service, but mobile payment options are emerging. Visa payWave, for example, which launched with Vodafone in March, allows people to buy small items by swiping a smartphone on a reader. But although Pingit garnered 120,000 downloads in five days, mobile payments are still slow on the uptake - why?
M-PESA was born out of necessity. With bank branches few and far between in Kenya, visiting one was an onerous and time consuming task. People who moved to the cities to find employment needed a way to send money home to their villages. People in Kenya may not have broadband access, but they do have phones - it was a natural next step to find a way to use them for digital transfers and payments.
But, apart from the fact that the technology providers and operators need to get their acts together to provide workable mobile payment solutions, we have too many payment options at our disposal already. Add another few - of which we don't know which one to trust - and we'd rather stick with what we've got. Old habits die hard.
Reverse innovation is a term coined by Vijay Govindarajan and Chris Trimble, to describe the process where products or services which are developed to meet the needs of developing nations are re-packaged as low-cost innovative goods for Western buyers. The way money is transacted in third world countries will dominate here. The Western way of commerce has been under-funded and needs to change significantly in the new economy of mobile money.