Since its launch in March 2007, M-Pesa has become Kenya’s dominant mobile money service, with at least one individual in 96 percent of Kenyan households using it.
The service is designed to enable customers to safely and securely send, receive, or make payments via their mobile phones.
Available in more than 170 countries globally, M-Pesa is currently serving over 70 million customers, processing close to 100 million transactions daily.
The success of this mobile money platform has been attributed to its accessibility, security, and convenience, making it a reliable tool for digital transactions.
Additionally, the zero-rating of some M-PESA transaction charges during the Covid-19 pandemic and the subsequent changes after resulted in the usage of the platform growing fourfold over the last five years.
The move followed the Central Bank of Kenya directive to mobile money providers to scrap charges on transactions below Sh1,000 and on transfers from Bank accounts.
CBK’s directive sought to encourage cashless money transfers to contain the spread of the deadly virus. The move provided relief for M-PESA subscribers who relied on the platform to pay for their day-to-day expenses, consequently promoting M-Pesa usage.
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“When we came back to charging,” Dr Ndegwa recalled, “We significantly reset the pricing of those transactions and reduced price by an average of 50 per cent.”
Safaricom decided to maintain a cushion for low-value transactions by not charging for person-to-person transfers of Sh100 and below and payments to merchants for Sh200 and less.
These are typically payments for transactions at kiosks and small vendors, and the average fare for a short hop on a bodaboda or a matatu ride.
The result was an increase in the volume of non-chargeable transactions to 58 per cent by the firm’s last financial year.
“Even if we have made many transactions free, the number of transactions that are chargeable per customer has tripled. So, we’ve made many transactions free but those who are now transacting with M-PESA are using three, four times what they were using,” said Dr Ndegwa.
M-Pesa’s growth has not only promoted financial inclusion but also transformed how businesses operate and transact.
This is evidenced by the growing Lipa na M-Pesa customers from 170,000 in 2020 to 680,000 in the last financial year. At the same time, Pochi La Biashara customers have almost grown from 600,000 to 1.1 million customers.
The agent network has also doubled from 150,000 to 300,000, presenting more opportunities for customers to deposit and withdraw money.
“We are supporting more than a million jobs indirectly through enabling the agent network,” Ndegwa added.
The introduction of credit and investment products such as Ziidi Money Market has also played a role in M-Pesa growth in the recent.
Ziidi, which boasts over one million opt-ins leverages the convenience of M-PESA to give customers a simple, faster, and smarter way to invest and grow wealth.
Besides transactions, Safaricom has also improved its interaction with its customers through the M-PESA Super App for individuals and businesses.
The M-Pesa Business App provides businesses with detailed reporting tools and a dashboard to track their cash flow. The app has been downloaded by more than 90,000 businesses since its launch early this year.
As more people across the continent shift to smartphones, 3G and 4G broadband, M-Pesa looks forward to continue to innovate more products and services, and launch new ones.
