The Money Transfer Service – Competition in the global market

In any given market a powerful business is whizz that looks for a strategy that will give it a competitive advantage over the rest of the players in the industry. This is key in penetrating the market and ensuring that it stays a notch above the opposites in the deli genuinely of a good or gain to its clientele. In some(prenominal) cases competition is quite healthy, as articulated below with regard to the wars mingled with Coke and Pepsi Companies in the United States The warf be must be perceive as a continuing battle without blood. Without Coke, Pepsi would produce a yobbo time being an original and lively competitor.The more successful they are, the card shark we defecate to be. If the Coca-cola company didnt exist, wed pray for someone to speculate them. And on the other side of the fence, am sure the folks at Coke would say that nothing contri butes as a great deal to the present mean solar day success of the Coca Cola Company than Pepsi. All types of businesses, however depressed they are, have had competition in one way or another. A mama mboga business will definitely have competition from the neighbours change the product. At the beginning there might seem to be none, but over time the competition emerges.Historical Background. The traditional electronic cash remove services embroil but not limited to the avocation Electronic Funds Transfer (EFT) service offered by banks, where cash in hand conduct one day to be maneuverred to the recipient. Real Time Gross serve well (RTGS) here funds are changered between banks within a crossbreed of two hours upon the instructions being issued by a client. This is a much faster approach than the EFT staff, serving as a big gain mainly to business people who need to seal deals faster. Telegraphic Transfers (TTs) this relates to the direct of funds from one rude to another, and takes approximately four working hours. coin Orders. These methods listed above require that one operates a b ank account something considered a luxury in some parts of the developing countries. Likewise in Kenya this proves a chall(a)enge especially for the people in the rural areas and the sexual settlements. As mentioned above, this listing is not conclusive as there are other known conventional means of lanceing money that include the following Western Union property Transfer Service gold Gram notes Transfer Service These two are phenomenon in sending of funds globally. Mobile Money Transfer Service No one ever envisaged that some day it would be possible to send funds using wide awake phones.However Kenya has now been introduced to the world eye socket as a result of pioneering the mobile money transfer service, Safaricom synonymic with the m-pesa product. The mobile money transfer refers to the movement of money from one coating to another by use of the mobile phone as a means of transfer. In essence this refers to translocation of e-money from one point to another without t he date of physical translocation. The journey of mobile money transfer began in the archaeozoic years 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 financial fundament to the recipients mobile. The recipient then would walk to a runner of the financial 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 hands 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 hand behind by the competitors. The facility is now spreading fast to other countries globally, albeit under different names. Competition The invention of the mobile money transfer has brought about 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 home of mobile money transfer. The new product has great implications on the financial sector, both positive and negative.Banks have since taking advantage of this engineering science to bring 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 slew 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 found in banks.This has seen banks aggressively move to t he public in wait of deposits, thereby giving large interest rates n the deposits, conflicting to the past where interest rates paid on deposits by banks were very low. The diversity of added provides on the main mobile money transfer service is making completion tight on banks. The adoption of M-Shwari encourages clients to save with the object of borrowing, with the collateral being the savings as opposed to known collaterals such as land title deeds. The use of Western Union and Money Gram 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 partner with the money transfer service providers in order to bung 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 services such as Nation Hela, whereby money can be dent from abroad direct to ones visa card, with a notification direct to the recipients phone.Currently payment of a number of bills is made direct from the phone as opposed to tone ending to queuing to make payments e. g. electricity bills, water bills etc. Conclusion Kenya is fast go home to a number of world accredited money transfer services that are equally spreading across the globe. These are expect to bring about intense but healthy competition on the financial front. These great innovations shall force financial institutions to rethink their strategies find the go around way to take competitive advantage.