The Money Transfer Service – Competition in the global market

In any given market a healthy pedigree is unity that looks for a strategy that will give it a warring advantage everyplace the rest of the players in the industry. This is key in crisp the market and ensuring that it stays a notch preceding(prenominal) the other(a)s in the spoken communication of a good or service to its clientele. In many cases challenger is quite healthy, as articulated below with regard to the wars between atomic frame 6 and Pepsi Companies in the United States The warfare must be perceived as a continuing battle without blood. Without snow, Pepsi would dedicate a tough eon being an original and lively competitor.The more achieverful they are, the sharper we entertain to be. If the Coca-cola company didnt exist, wed pray for some iodine to invent them. And on the other side of the fence, am sure the folks at Coke would say that nothing contri simplyes as much to the present day success of the Coca Cola Company than Pepsi. All types of businesses, h owever small they are, have had competition in one behavior or another(prenominal). A milliampere mboga business will definitely have competition from the neighbours selling the product. At the beginning t here(predicate) might seem to be none, but over time the competition emerges.Historical Background. The traditional electronic property reposition function include but not limited to the pursuit electronic Funds Transfer (EFT) service offered by avers, where finances take one day to be interchangered to the telephone receiver. Real Time Gross Service (RTGS) here property are transitred between banks within a span of ii hours upon the instructions being issued by a client. This is a much rapid approach than the EFT module, serving as a big boost in the main to business people who need to seal deals faster. Telegraphic Transfers (TTs) this relates to the move of funds from one country to another, and takes approximately four working hours.Money Orders. These methods listed above require that one operates a bank account something considered a extravagance in many parts of the developing countries. Likewise in Kenya this proves a challenge especially for the people in the rural areas and the informal settlements. As mentioned above, this listing is not conclusive as there are other known conventional pith of get bying currency that include the following Western Union Money Transfer Service Money deoxyguanosine monophosphate Money Transfer Service These two are phenomenon in projecting of funds globally. Mobile Money Transfer Service No one ever envisaged that some day it would be possible to send funds using officious phones.However Kenya has now been introduced to the world arena as a result of pioneering the mobile money transfer service, Safaricom synonymous with the m-pesa product. The mobile money transfer refers to the movement of money from one destination to another by expenditure of the mobile phone as a means of transfer. In ess ence this refers to translocation of e-money from one point to another without the involvement of physiologic translocation. The journey of mobile money transfer began in the early age of 2000, with the launching of Sokotele by the then Celtel mobile company.The service enabled one to send funds via mobile, where the transaction was initiated through a pecuniary institution to the recipients mobile. The recipient then would walk to a branch of the monetary institution and be paid. The m-pesa product worked on the same module but enhanced the same, by putting the power of money transfers in the detention of the cellphone owner. This meant the bank link was removed from the equation, with the people dealing with each other through agents spread all over the country including the remote rural areas.The invention of the money transfer service has seen all the mobile companies in Kenya running the service, not ready to be left bottom by the competitors. The facility is now spreadi ng fast to other countries globally, albeit to a lower place different names. Competition The invention of the mobile money transfer has brought slightly a revolution in the financial sector, affecting the forms of funds transfer as mentioned above. This is slowly permeating the global scene, with Kenya serving as the ingleside base of mobile money transfer. The new product has cracking implications on the financial sector, both positive and negative.Banks have since taking advantage of this technology to fill on board clientele that have adopted mobile money transfer. They have relied on this platform to introduce mobile banking to their clients, empowering them to have their bank accounts in their hands whereby they can withdraw funds from their accounts by use of the mobile phones and vice versa. On the downside of it, a greater portion of the population is now saving their money on the mobile money transfer facilities. The facility seems to be growing fast into an e-bank, which affects the deposits that are traditionally raise in banks.This has seen banks aggressively move to the public in search of deposits, thereby giving large interest rates n the deposits, contrary to the yesteryear where interest rates paid on deposits by banks were very low. The variety show of added provides on the main mobile money transfer service is reservation completion tight on banks. The adoption of M-Shwari encourages clients to save with the intention of borrowing, with the confirming being the savings as opposed to known collaterals such as land title deeds. The use of Western Union and Money gibibyte locally has declined due to the convenience of M-pesa, Airtel Money, Yu Cash and Orange Money in Kenya.With the spread of these facilities across the world (e. g. Airtel money in many African countries and India). With reduced demand for the formally established products, some of the providers have opted to furnish with the money transfer service providers in or der to tap into the great technology e. g. Western Union partnered with Safaricom, whereby funds can be send from overseas direct to ones phone in Kenya. The money transfer service has also seen the introduction for card transfer work such as Nation Hela, whereby money can be surgical incision from abroad direct to ones visa card, with a observance direct to the recipients phone.Currently payment of a number of bills is made direct from the phone as opposed to going to queuing to control payments e. g. electricity bills, water bills etc. Conclusion Kenya is fast becoming home to a number of world accredited money transfer services that are equally spreading across the globe. These are expected to shape about intense but healthy competition on the financial front. These great innovations shall force financial institutions to rethink their strategies find the best way to take competitive advantage.