What you need to know:
- Increasing use of cashless payments in various aspects of the economy continues to raise transaction volumes
New avenues for the use of mobile payments and rising uptake by consumers saw money transfers grow by 27 per cent to Sh1.7 trillion in nine months through September, this year.
This implies that mobile phones are transferring at least Sh6.3 billion daily, underscoring the importance of mobile money services in people’s lives. Last year, mobile money transfer transactions stood at Sh1.37 trillion.
Mr Thomas Makau, a technology analyst, says the upswing is being driven by increased use of mobile money to transfer cash and pay bills by both individuals and companies.
“We are seeing increased uptake of services such as Lipa Na M-Pesa in payment for utilities by consumers. We are also seeing a lot of players coming on board to offer mobile money transaction services,” Mr Makau noted.
The rising integration of mobile money in different sectors of the economy, such as the entire financial services industry, transport, adoption of cashless payment services by the government, among others continues to raise the transaction volumes of mobile money.
“Diversification in the use of mobile money services, not just for money transfers, but for utility payments is what is causing this growth. We are also seeing increased marketing of cashless payment services by various players in the market,” said Mr Danson Muchemi, CEO of Jambopay, a mobile payment services company.
Cashless payments have already been rolled out in the transport business. A mobile platform is now being used in paying parking fees in various counties as well as paying for government services.
“Mobile money is going to be a major driver, especially in facilitating cashless transactions, competing with both cards and cash going forward,” Mr Muchemi added.
The number of mobile money transfer subscriptions is currently at over 26 million out 32 million with mobile phones in the country.
Safaricom commands the largest share of mobile money market, with more than 19 million customers and more than 80,000 agents, out of the 124,179 mobile money agents in Kenya.
Lipa Na M-Pesa, Safaricom’s bill paying service, has 139,000 merchants.
Equity Bank has also joined the mobile money bandwagon, a strategy expected to further drive up the value of transactions. Other companies in this business are Airtel Kenya, Orange Telcom, Tangaza Pesa and MobiKash.
Kenyans use mobile services to transfer cash, pay bills and make banking transactions such as depositing or withdrawing money from bank accounts.
They also use the platform to buy airtime, data bundles, Mobile money consumers also make payments to schools, hospitals and other organisations, shop online and at retail outlets as well as pay for electricity and water bills among others.