In the epicenter of global m-banking today(Kenya), the M-Banking 2009: Balancing Regulation and Innovation conference in Nairobi was a landmark event–bringing together bankers, telecoms and Central Bankers to hash out the issues and resolve the tensions between them. The protagonist was/is Safaricom’s  M-PESA money-transfer-by-mobile phone, which has caught bankers flat-footed.

From hotel porters to members of Parliament, everyone is using M-PESA, to send money home to villages, pay bills and tuition–and store money in their phone.  Even in Kibera, the largest slum in Africa with 1 million people living without electicity or sewage, M-PESA is being used by local savings groups to mobilize money.  Some groups have used their meager savings to invest on the stock market–in M-PESA.

Organized largely by students at The Fletcher School (Center for Emerging Markets Enterprises) and co-sponsored by the Kenya School of Monetary Studies, with lead support from Kenya’s Equity Bank, the conference provided a forum for the Central Bank of Kenya to address simmering tensions between the banking community and Safaricom, whose M PESA mobile-money transfer system is spreading like wildfire. With more than 6 million M-PESA accounts, more people in Kenya are transferring money by mobile phone than have bank accounts.

High-level Kenyan dignitaries included the Governnor of the National Bank, the Vice President of Kenya, and the Ministers of Finance and Communications. Attendees included the Central Banks of Uganda, Tanzania, and Rwanda, numerous commerical banks, Safaricom,  and interested parties primarily from Africa and Europe, butalso including World Bank’s CGAP and Bankable Frontiers from the U.S. The presentations and debate were high-level and high-spirited.

The week of the conference,  Business Daily Africa ran a 12-page spread representing numerous points of view; during and after the conference, local TV and print media ran multiple stories.

More updates to follow…I’m going to predict, there’s something happening here.

The village-phone scheme pioneered by GrameenPhone in Bangladesh has been successfully implemented in Uganda and Rwanda by South Africa’s MTN, and in the Philippines by Globe Telecom. The common thread to these replications is consulting advice from the Technology Group at Grameen Foundation USA.

After several years working out the kinks and writing manuals to ease implemenation, Grameen Foundation has now released a Village Phone Direct kit, which it sells to microfinance institutions around the globe. The kit includes:

• Nokia mobile phone with earpiece
• External booster antenna for areas without strong mobile signal coverage
• Custom designed cables to connect the phone to the antenna and the recharging equipment such as a automobile battery or a solar panel

To complete the Village Phone Equipment Kit for the microfinance client, a SIM card and prepaid airtime, which can be purchased through regular outlets.

A very unusual and innovative way to raise money for social causes has attracted such of the world’s best known consumer product companies, such as GAP, Converse, Armani Exchange, and Motorola. They are selling products under the band name Red and donating a percentage of profits to the Global Fund (a project supported by Tony Blair, Bono, the Bill and Melinda Gates Foundation, among others). Red is a brainchild of Bono’s. (Want to Help Treat AIDS in Africa? Buy a Cellphone, from the New York Times.) 

To date the Global Fund has raised $10 million in Britain, with which it is testing treatment of HIV-positive women and children in Rwanda. Red products are just hitting shelves in the U.S.

Bill Gates told the New York Times:

“Red is one of the first major efforts to tap more Americans to contribute to fighting AIDS a continent away. And they can do so simply, just by switching their cellphone or buying some of the clothing that’s part of the Red line.”

Says Ron G. Garriques, president of mobile devices at Motorola: “I don’t believe it’s giving up profit. What I believe is, it’s making more profit.”