Safaricom upgrades system for faster mobile banking

Money Markets

Safaricom CEO Bob Collymore says customers will start to experience fast turnaround time in mobile banking. Photo/FILE 

By John Gachiri

Customers of mobile banking will be able to transact in real time after Safaricom upgraded its systems to reduce the turnaround time for transactions that go through its mobile money transfer service M-Pesa.

The telco said the upgrade of its Application Programmable Interface (API) has reduced the turnaround time to less than 30 seconds from the previous average of two hours.

Safaricom chief executive Bob Collymore said most customers who use mobile banking services will begin to experience the reduced time since most major banks and saccos had complied with the new system.

“Twelve leading banks and 26 saccos have already migrated to the new platform and migration is on-going for 30 other institutions,” said Mr Collymore in a statement.

The number of customers who use the service has more than doubled since 2011 when the service was introduced. Customers who use mobile banking stood at 8.8 million by the end of 2013 from 3.35 million in 2011.

Safaricom said it expects the number of customers to be around 13 million by the end of this year.

Analysts say the drive for efficiency and innovation is the next step in the mobile money transfer services in Africa.

“Almost all mobile operators now have a mobile money offering, although not as successful as M-Pesa of Kenya. Delivering more mature mobile banking services is what telcos may now be looking for,” said a report on telecommunications by consulting firm Deloitte.

Equity Bank is also investing in a mobile license as a cost-cutting measure and to improve efficiency.

The bank said its newly acquired Mobile Virtual Network Operating (MVNO) licence is expected to cut transaction costs to Sh7 from Sh14 — the cheapest cost charged for transaction carried out through bank agents.