Vodafone India, which together with ICICI Bank rolled out its mobile money transfer and payment service m-pesa in Gujarat on Monday, plans to expand it across India in 2014, a senior official said here.

Vodafone , which currently provides m-pesa service in 11 States in the country, is targeting the $60 billion money transfer market in the country, 20% of which is dependent on the traditional channels like post offices, said Suresh Sethi Business Head, m-pesa.

The telecom service provider is also targeting the government benefits transfer market worth $55 billion.

At present, 30 per cent of money is transferred through formal channels and 70 per cent through informal ones, including ‘havala’, he said.

Vodafone, which launched m-pesa in Kenya in 2006, now has an 85 per cent market share in that African country with a population of 40 million. In Africa, more people have mobile banking accounts than traditional ones, he said.

About the rollout in India, Bhuvanesh Pratap Singh, Operations Director, West, Vodafone India, said only 35 per cent Indians have access to formal financial services with only one branch for every 12,000 people. Only 5 per cent villages have a bank and 73 per cent farmers’ households have no formal sources of credit. Besides, 300 million migrant populations across India had only a limited access to banking services. Normally, villagers have to travel up to 40 km to access a bank.

In India, the overall penetration of telecom services is 70% in urban areas and 40% in rural areas, with Vodafone being the number two provider in terms of revenues. In Gujarat, it covers 96% of population with a 17 million subscriber base, said Brajesh Bajpai, Business Head, Gujarat.

Vodafone would levy transaction charges between 1.2 and 1.5% of the value of transaction.