Cashless payments lift mobile transfers to Sh2.3trn by October

More Kenyans are embracing use of mobile money, according to Central Bank of Kenya. PHOTO | FILE 

By DAVID HERBLING, hdavid@ke.nationmedia.com

In Summary

• Safaricom chief executive Bob Collymore attributed the continued double-digit growth in mobile money use to the convenience of the platform and the increased utility of M-Pesa. Safaricom accounts for three-quarters of mobile cash subscribers and controls two-thirds of total agents.
• Kenya has 28.5 million mobile money users who transact across six major platforms — M-Pesa, MobiKash, Airtel Money, Orange Money, Tangaza, and Equitel — backed by a network of 140,612 agents as at October.
• Kenya tops the world with the highest number of adults with a mobile money account, at 58 per cent, followed by Somalia’s 37 per cent thanks to its well-entrenched mobile-based Hawala system.

Mobile money transfer volumes grew by a fifth in the first 10 months of this year almost matching the total moved in full-year 2014 as more Kenyans used the platform to pay for goods and services.

The latest Central Bank of Kenya (CBK) data shows that mobile payments grew by 19 per cent to Sh2.31 trillion as at the end of October, nearly equalling the Sh2.37 trillion handled in 2014.

This means Kenyans made an average of Sh192.7 billion of real-time mobile-based payments monthly, or Sh6.4 billion a day in the period to October 2015 compared to Sh5.4 billion daily in a similar period last year.

Safaricom chief executive Bob Collymore attributed the continued double-digit growth in mobile money use to the convenience of the platform and the increased utility of M-Pesa.

“The growth of mobile money is largely due to consumer confidence, convenience and security of the service,” Mr Collymore said in an interview with the Business Daily.

“There’s no need to carry cash around,” he said, referring to the expanded uses of mobile money services to include paying for shopping, utility bills such as water, rent and electricity, receiving dividends and diaspora remittances.

Official data shows Safaricom’s M-Pesa handles about Sh60 out of every Sh100 transacted on mobile money platforms in Kenya, accounts for three-quarters of mobile cash subscribers and controls two-thirds of total agents.

Kenya has 28.5 million mobile money users who transact across six major platforms — M-Pesa, MobiKash, Airtel Money, Orange Money, Tangaza, and Equitel — backed by a network of 140,612 agents as at October.

Communications Authority director-general Francis Wangusi credits the increased uptake of mobile money to runaway success of the platform that has become part of everyday Kenyan life.

“Mobile money transfer service continued to record steady growth due to its increasing popularity and convenience in usage,” said Mr Wangusi in the regulator’s latest industry report.

MobiKash, controlled by investment firm Foundation Enterprise Programme, linked the growth in mobile cash volumes to higher uptake of business payments such as shopping and bulk payments processing.

The firm in May last year launched Lipa Sasa na MobiKash — a merchant payments service which allows customers to pay for goods and services — and has so far recruited 3,500 merchants across Kenya.

“Our growth is mainly from bulk payments processing for salaries, retail payments and business-to-business payments,” said Duncan Otieno, chief executive at MobiKash.

Kenya tops the world with the highest number of adults with a mobile money account, at 58 per cent, followed by Somalia’s 37 per cent thanks to its well-entrenched mobile-based Hawala system. Uganda is at 35 per cent and Tanzania 32 per cent, according to the World Bank 2014 Global Findex report.