The aim of this paper is to analyze the effect of mobile money in Kenya with a special interest on the small business enterprises.  Mobile phone in used to transfer funds between banks or accounts, deposit or withdraw funds, or pay bills. This term is also used for the broader realm of electronic commerce; it can refer to the use of a mobile device to purchase items, whether physical or electronic (Agrawal, 2009)
Kenya has been in the leading board on the success story of the development and adoption of mobile money transfer. Four organizations give cell phone benefits in Kenya. These incorporate Safaricom, Airtel (formally Zain), YU and Orange (formally Telkom Kenya). Safaricom was the principal organization to give versatile administrations and MMT benefits in Kenya. In organization with the Commercial Bank of Africa and a small scale fund organization, Faulu Kenya, Safaricom outlined and tried a miniaturized scale installment stage called M-PESA in 2004. ‘Pesa’ signifies ‘cash’ in Kiswahili and the prefix ‘M’ alludes to the utilization of a cell phone to encourage managing an account exchanges. M-PESA started by utilizing Safaricom’s broadcast appointment retailers (operators) to issue microloans that borrowers would reimburse at a loan cost lessened by killing the overhead regular microloans conveyed. Be that as it may, the talented specialist in Kenya soon started utilizing the office to exchange trade from working relatives out the city to their families in the rustic regions (Hughes and Lonie, 2007). 

In the versatile cash division, Kenya yet in front of the world: it is intended to bring the financial focal points of having an investment funds and cash exchange office to those with little, unpredictable or patterned salaries (Pagano, 2001) Recent confirmation recommends that there is an expansion in infiltration and utilization of MMT Services in Kenya. In mid-2011, Safaricom had a M-PESA membership base of around 16 million and around 17,000 operators (outlets) nationwide (Central Bank of Kenya, 2011).
It was in the twentieth century when mobile phones use increased dramatically as people found these portable electronic devices to be convenient and easy to use (Orozco, Jacob and Tescher, 2007). As a result of seeing people inclined to their phones, operations such as banking, money transfer and paying of bills was made easier by use of phones to perform such errands conveniently. This was also established to be of benefit to the very many people especially those in the rural areas who lacked access to financial services such as savings account, credit insurance and payment services. During that period, a great percentage of the country’s households were financially excluded. Today in Kenya the adoption of mobile money services has been very successful. Mobile financial services aided companies to address needs of users (Njuguna & Mwangi, 2009).
Mobile money transfer operates in a simple and a very efficient manner. This is by assisting the customer to use the phone device as a bank facility whereby saving and loaning is at the tip of the customers’ phone keyboard. This has greatly easened the transfer of funds between customers and hence hastened the way of doing business within the country. Services like banking and utility payment in now done from the comfort of one’s phones eliminating the previous modes of payment which involved lining up for hours to get the same services. A customer also has access to the cash at any one time and requires only authorizing the money transfer or withdrawal from his end to gain access to the same. (Dichter, 2007).
Mobile money transfer providers are economic organizations or business organizations that can be family firms, partnerships or limited companies that had been formed with the aim of fulfilling a certain objective that was set. The providers engaged in business ventures that ranged from vendors, manufacturing, and customer service. The providers’ juggled different types of businesses with the aim of making ends meet for themselves while ensuring they remained enterprising and retained customer base and thus in most cases may be specialized in a certain industry and still engaged in another for revenue purposes (Dichter, 2007).
MMT had a clear edge over banks especially because it was fast and cost-effective. For instance, to send KSh. 35,000 ($350) within the country using a classic money transfer company such as Western Union would cost KSh. 1,200 ($ 12), but using MMT method, such as M-PESA, to send the same amount would cost only Ksh. 75($ 0.75) which is 6 times cheaper (Central Bank of Kenya, 2010).Classic money transfer methods requires that one must visit a given post office or bank (which could be a long distance away) to receive the remitted cash. Most banks and post offices were associated with long queues and fixed times of operation hence the opportunity cost of time spent while waiting to obtain the cash and other transaction costs were usually high.(Masinge,2010)
Mobile Money operators (MNO’s) are telecommunication organizations that provided telephony services such as voice, data, short messages services (SMS) that enabled customers to communicate with one another through provision of the service and most recently we had money transfer service through the use of mobile phone (Ivatury and Pickens,2006). In Kenya, there are various telecommunication companies like Essar Telecom commonly known as YU that was launched in the market in December 2008 and have their mobile money transfer (MMT) system called YuCash, Orange Telecom with Orange Money-Iko PESA, Airtel Kenya with Zap and Safaricom with M-PESA(Pilat, 2009).
The applicability of Agency theory is also explained as exhibited by the relationship between one party called the principal, that delegates work to another called the agent, in the mobile money operations. To thrive and penetrate in any country MNO’s provided business opportunities to the providers to act as their intermediaries with their key role acting as wholesalers or distributers of their merchandises that is airtime vouchers, SIM cards, handsets, laptops and various electronic devices (World Bank, 2006). It enabled the providers to take up the business venture and embraces it as an additional revenue generation to their current business through the improvement of access to financial services, such as savings, deposits, insurance and remittances, as a vital to reducing poverty. Transaction cost theory is also explained as the acting companies within the mobile money sector expand or source out activities to the external environment. This is in a bid to minimize the costs of exchanging resources with the environment and minimize the bureaucratic costs of exchanges within the company. This implies that companies weigh the costs of exchanging resources with the environment, against the bureaucratic costs of performing activities in-house (Coase, 1937).
Savings helped poor people to invest in productive assets like livestock, a loan helped in expanding business activities, and insurance provided income for a family when the breadwinner became sick. In many developing countries, however, 9 out of 10 people do not have a bank account or access to basic financial services (Pickens, 2009). 
Poor people were often not considered viable customers by the formal financial sector as their transaction sizes were small, and many lived in remote areas beyond the reach of bank’s branch networks. Informal banking services such as microfinance, village savings and loan associations remained limited to their reach (EMI, 2010).
The study seeks to answer for the following questions:
i) The role mobile money has played on the rise of small business in   Kenya?
ii) To what extent does mobile money transfer affect the mode of doing business in Kenya? 
iii) How the mobile money has affected the common citizen in Kenya, on saving and costs perspective?
This study employees explanatory research design which focuses on why questions by developing casual explanations. An explanatory survey design shows how variables relate to each other. It aims at establishing a cause and effect between variables. The dependent variable is economic growth for the year 2007 to 2015. The independent variables are mobile money transfer agents, mobile money transfer customer enrolments, mobile money transfer transaction frequency and mobile money transfer deposit value.
The secondary data will be collected from the CBK and the (KNBS) Kenya National Bureau of Statistics reports. The study’s data collection source will be  justified by the fact that data on mobile money transfer agents, mobile money transfer customer enrolments, mobile money transfer transaction frequency and mobile money transfer deposit value are  available in the CBK while the same works hand in hand with KNBS in making such statistics and estimation. Both regression analysis and time series analysis will be used to analyze the data. The scope of the study is to determine the effect of mobile money transfer on small businesses in Kenya and which is reflected in the economic growth experienced. The geographical scope of the study was Kenya.
The data is modeled in time series. The analysis will be conducted through a procedure of various steps. After successful data collection exercise, the obtained data is verified and edited for completeness and consistency. A content analysis and descriptive analysis will be employed. Tables and other geographical presentations as appropriate will be used to present the data collected for ease of understanding and analysis. Various assumptions are to be carried out to find out the causal and effect of the variables between the independent variables and dependent variables.(Mugenda,2003)


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