Dear TMS Ruge, Quartz called it as it is

The online publication Quartz published an article yesterday about Mobile Money and specifically the Kenyan M-PESA. I agree with the sentiments in the article. M-PESA, ubiquitous here in Kenya, has never really lived up to its potential. Online payments are an obvious gap in the product’s features for instance. Small transactions aren’t feasible due to exorbitant transaction fees. And the lack of interoperability hampers innovation and competition.
TMS Ruge, a founder of the Ugandan remittance service Remit.ug has since written a response to the article in which he says

Dear Quartz, it’s too early to make a call on the success of mobile money in Africa

I disagree. M-PESA has been around for close to a decade. In that period Android smartphones have made their way into millions of hands around the world.Uber went from a quaint German word we all didn’t know exactly how to pronounce to the service Nairobi cabbies are fighting tooth and nail today.
As a student of the impact and adoption of technology, especially payment and financial technology I feel that M-PESA has had plenty of time to make an impact.
In response to Quartz’s observation that

The impact of mobile money, for one, has not been uniform across the continent. M-Pesa has been a resounding success in Kenya, where over half of adult consumers have an account and a huge share of the country’s GDP passes through the system. Yet it was slower to take off in Tanzania, and an outright failure in South Africa.

Ruge says

I think this is Quartz’s idea of kicking a Kenyan child just because it isn’t winning marathons. This is article smells of a half-backed “yeah, but…”
M-Pesa is a huge success in Kenya, yes. That doesn’t mean it has to be a success everywhere on the continent. M-Pesa is a digital currency, as much as the Kenyan shilling in Kenya. No one said the Kenyan shilling was a failure in Uganda or Rwanda.

M-PESA has been touted as a world beating mobile money solution. When it fails to win the race in the neighbourhood playground questions must be asked.

Ruge goes on to say

Even though M-Pesa’s about 10 years old, it doesn’t mean that mobile money on the continent is anywhere near mature, and thus ripe to be graded success or not. With a billion mobile devices on the continent and a rising uptake in smart phones, we are just getting started.
In Uganda, MTN continues to see modest growth in it’s mobile money subscribers. There are now more mobile money accounts in the country than traditional bank accounts . There are a lot of eggs in Uganda’s emerging digital economies that are getting ready to hatch; this is the youngest country on the continent, internet penetration is approaching 35%, a few bricks were torn down in the interoperability wall between M-Pesa and MTN’s Mobile Money.

The facts about Internet penetration and the uptake of smartphones have little to do with Mobile Money. Solutions like M-PESA work just fine on dumb phones without Internet connections. And of course Uganda isn’t the youngest country on the continent. That honour falls on South Sudan. But I digress.

Not sure how much longer than 10 years Ruge would have us wait before we form an opinion on M-PESA’s prospects.
Here is what M-PESA has proven so far in the last 10 years: It has failed at micro-payments, the sort of transactions people make at their mama mboga’s (green grocer), it is extremely expensive to the people that do make transactions on the service (sending a dollar attracts a 10% commission charge, withdrawing a dollar a 27% commission) and it can not stand up to competition from banks in countries where banking is more pervasive.
In the same period, Safaricom the company that owns and operates M-PESA has fought aggressively against mobile money interoperability.

It is too early to call mobile money a failure. There are too many pieces still forming in the continent’s primordial digital soup. To claim to have enough facts to have such a view smacks of complete ignorance of the facts on the ground.

M-PESA did fail in South Africa. That’s a fact. Still the Quartz article makes no such sweeping statement about mobile money’s failure, pointing out instead that it has failed to live up to its potential.
We have seen enough and we are tired of waiting.