Mobile Money Interoperability: Central Bank of Kenya is set to force Safaricom’s Lipa na M-Pesa to start accepting payments from Airtel and other money transfer rivals. This will be done through a national payment system which the CBK is set to launch in 2024.
Under the new system, customers who have subscribed to Airtel will be able to pay for goods and services using Lipa na M-Pesa till numbers.
Over the past few years, Safaricom’s Lipa na M-Pesa has been experiencing a meteoric rise into one of Kenya’s most preferred mode of payment for goods and services. In the year to January, Lipa na M-Pesa is said to have handled payments worth Sh. 970.2 billion, just Sh. 30 billion shy of the Sh. 1 trillion payments mark.
However, according to CBK, the increased use of mobile money at agents and merchants has been constrained by lack of interconnection among the telecommunications operators, something Safaricom has been slow to integrate into its systems.
“This trend is expected to continue increasing once initiatives such as interoperability are fully rolled out, allowing customers to seamlessly transact across the ecosystem irrespective of their provider,”
the CBK said.
“The emergence of a fully integrated ecosystem that is seamlessly interoperable is critical. A strong foundation has already been laid with the roll out of P2P [peer-to-peer] interoperability in 2018 and the industry engagement that culminated in the proposal for a single integrated solution with multiple functionalities.”
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According to a related report that appeared in the Business Daily on Friday,
“the interoperability — the ability of different IT systems to communicate and exchange data — will offer Airtel a larger share of the mobile money payments made through merchants and deepen financial inclusion.”
Currently, Safaricom, Airtel, and Telkom are locked in a battle over market dominance following the Communications Authority decision to cut mobile termination rates. The authority cut the rate mobile phone operators charge each other for interconnecting customers by Sh. 0.87 which was equivalent to 87.7 per cent.
