Airtel Money customers will not be able to withdraw funds from Safaricom’s
M-Pesa agents and vice-versa even as the two leading telecoms companies
move to facilitate smooth flow of funds across networks under the
interoperability platform that goes live on Tuesday.
Airtel
said it still expects customers to withdraw money from agents of the
respective networks because “agent interoperability is not available.”
“It
all means that when an Airtel Money customer sends money to an M-Pesa
customer, the account balance of the M-Pesa customer will be updated
instantly and the M-Pesa customer can either go to an M-Pesa agent to
withdraw the funds or use it in other mobile cash transactions,” said
Airtel.
The telecoms operators said in a statement
published in local newspapers on Friday that interoperability is aimed
at easing the transfer of funds across networks by connecting the mobile
wallets.
Previously, a customer would receive an SMS from another network
notifying them that money had been sent. They would then have to look
for an agent of the network from which the money was sent to withdraw
and then deposit the same into their own wallet.
The money would be reversed to the sender if not withdrawn within seven days.
“Interoperability
had been identified by a competition study as one of the important
aspects with regards to ensuring effective competition in mobile money
market. The initiative is therefore complementary to the findings of the
study,” the Communications Authority of Kenya (CA) said.
The service on both networks will initially be available on USSD (short code) rather than within the apps.
“Subscribers
on the Safaricom network will need to use a short code to send money,
as opposed to sending money to other M-Pesa subscribers via Sim Toolkit
or the Safaricom App,” Safaricom said.
Safaricom has
dubbed its service M-Pesa Popote, setting a minimum Sh10 and a maximum
Sh70,000 limit for money being sent or received on M-Pesa.
Prevailing
on net money transfer tariffs will apply to any money sent via M-Pesa
Tuma Popote while customers sending to unregistered recipients using the
menu option will be charged the off net tariff.
“For
cross wallet transfer, we have shared our proposed tariff and the same
is under review by the Central Bank of Kenya,” Airtel said.
Safaricom
is the dominant player in the mobile money market which accounts for 67
per cent of mobile money agents and about 40,000 merchants, who accept
M-Pesa payments.
The number of active mobile money
transfer subscriptions and registered agents stood at 28.1 million and
184,537 respectively, according to CA statistics for the first quarter
of 2107/2018.
M-Pesa controlled 80.8 per cent market
share during the quarter under review. Equitel Money accounted for 6.8
per cent of the market while Mobikash had 6.3 per cent.
Airtel Money and Mobile Pay Limited stood at 5.8 per cent and 0.3 per cent market shares respectively.
Interoperability
is the latest development in the money transfer market, coming nearly a
year after banks successfully integrated their systems using PesaLink –
an electronic platform that allows transfer of funds across accounts in
different banks.
The platform is offered by
Integrated Payment Services Ltd (IPSL), a fully owned subsidiary of
Kenya Bankers Association (KBA), and can handle person-to-person
transfers from as low as Sh10 to a high of Sh999,999.
PesaLink
was expected to rival mobile money services currently dominated by
Safaricom’s M-Pesa. KBA manages the switch and facilitates direct
transfers without going through intermediaries such as M-Pesa, Airtel
Money and Tkash.
In its first nine months of operation, the interbank money transfer platform transacted Sh8 billion.
While
the initial phase of the project involved person-to-person transfers,
the second phase will include businesses and establish partnerships with
government agencies, mobile virtual network operators (MVNO) and other
players in the mobile money transfer subsector.
This would result in a fully integrated banking and mobile money system.
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