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> Kenya began a slow transition to a cashless society — and they did this without banks This is a bit odd. Safaricom is the bank here, inasmuch they track cash

> Kenya began a slow transition to a cashless society — and they did this without banks This is a bit odd. Safaricom is the bank here, inasmuch they track cash transfers and perform deposits and withdrawals. If you don't trust them, surely you wouldn't trust this system? It's certainly an interesting state of affairs, because a one-layer payment system is quite different from e.g. American infrastructure where a consumer bank, payment method, and business bank are three different entities. But I wouldn't call it bank-free in the sense that, say, cryptocurrency advocates mean.

dmix 9y ago
Well if you want to be pedantic about the definitions: "and they did this without banks" = "and they did this without legacy incumbent banks (/financial institutions) that previously dominated traditional banking" The reason it worked so well in Kenya was because everything didn't have to go through these legacy organizations. These legacy organizations dominate the market in each western country and face little competition from upstarts like Safaricom/Kopo Kopo due to high barriers of entry via regulations (regulations designed with the mega-banks with teams of lawyers in mind). I mean why else was a poor country full of dumbphones able to implement a cashless society in a very short time frame while a rich country full of powerful smartphones can't even get chip-based debit cards implemented in a timely fashion? The reason is none of us entrepreneurs, or the typical SV investors, are in a rush to do the same here is because of the huge risk involved. The risk being spending a huge amount of time/resources getting regulatory approval while simultaneously trying to build a customer base and keep the bills paid. Even Google/Apple have only put a token investment in getting their payment systems adopted, they built the client platform and assumed other companies would jump up to push adoption to the platform ...if only there was some type of company that had relationships with both SME businesses doing consumer billing/retail AND had access to client bank accounts and credit cards...hmm they'd be ideal to do this. Maybe if the banking industry had competition they'd put this type of effort into their industry and we could have gotten rid of our wallets full of plastic cards years ago.

dmix 9y ago

Well if you want to be pedantic about the definitions: "and they did this without banks" = "and they did this without legacy incumbent banks (/financial institutions) that previously dominated traditional banking" The reason it worked so well in Kenya was because everything didn't have to go through these legacy organizations. These legacy organizations dominate the market in each western country and face little competition from upstarts like Safaricom/Kopo Kopo due to high barriers of entry via regulations (regulations designed with the mega-banks with teams of lawyers in mind). I mean why else was a poor country full of dumbphones able to implement a cashless society in a very short time frame while a rich country full of powerful smartphones can't even get chip-based debit cards implemented in a timely fashion? The reason is none of us entrepreneurs, or the typical SV investors, are in a rush to do the same here is because of the huge risk involved. The risk being spending a huge amount of time/resources getting regulatory approval while simultaneously trying to build a customer base and keep the bills paid. Even Google/Apple have only put a token investment in getting their payment systems adopted, they built the client platform and assumed other companies would jump up to push adoption to the platform ...if only there was some type of company that had relationships with both SME businesses doing consumer billing/retail AND had access to client bank accounts and credit cards...hmm they'd be ideal to do this. Maybe if the banking industry had competition they'd put this type of effort into their industry and we could have gotten rid of our wallets full of plastic cards years ago.