As they announced their 2017 financial results today, Safaricom also unveiled 1Tap – the next step of innovation to drive increased financial inclusion in Keyna.
M-Pesa is ten years old and CEO Bob Collymore said that Safaricom was launching “Mpesa 1 tap” which would reduce the number of steps to complete an M-Pesa transaction, currently about 8 steps on SMS and USSD, to just 1 step.
At the result announcement, the Safaricom CFO Sateesh Kamath said that while 75% of M-Pesa revenue was from traditional person to person transfers, 25% was new from new business like “Lipa na Mpesa” (pay with M-pesa) payments.
Buy Goods is free for customers, except at petrol stations which levy an additional charge, and just over a month ago, Safaricom announced a 50% tariff reduction for all Lipa Na M-PESA Buy Goods merchant fees – to 0.5% of the transaction amount. These were also was capped to Kshs 200 for any payments over Kshs 40,000 (~$400) while payments to merchants below Kshs 200 were made free. Lipa Na M-pesa is used by over 50,000 merchants and Safaricom plans to enable more kiosks, boda-bodas, newspaper vendors and other merchants who are in the informal sector where 80% of Kenyan work to receive such vital business payments at no cost.
Merchants can also get instant payments into their bank accounts at any of 23 partner banks (of the 40 banks in Kenya) from a Lipa Na M-pesa menu in their phones in just a few seconds – and this is useful as many of the merchants don’t have time to go to the bank to deposit cash.
With 1 Tap, all a customer needs to do is tap their cards on the mobile POS machines and then enter their secret M-Pesa PIN to confirm the transaction. Pilot testing for Mpesa 1 Tap has been ongoing in Nakuru where the service now has 13,000 customers and 900 merchants. Kenyans briefly got to see what NFC could work with the Beba Pay service a few years ago, with payments in public service vehicles.
Monday’s nationwide outage of telephone, internet data, and mobile money services showed the practical need for people and companies to have viable alternatives for their daily connectivity. One of the oldest companies in this space is Telkom Kenya.
While it has been in the news more for its foray into mobile phone business under the Orange brand, other parts of the company have continued to chug along providing affordable and reliable services to customers, governments, and institutions all across the country
Telkom Enterprise has three key connectivity products: JamboNet for large businesses, E@synet Broadband for SME’s, and Flybox for homes and small businesses. Telkom has continued to invest and grow its infrastructure as well as through partnerships in submarine cables to extend broadband connectivity. The Telkom Kenya Entreprise division is now led Kris Senanu, long-associated with Access Kenya and the history of internet service businesses in Kenya. Telkom manages the National Optic Fibre Backbone (NOFBI) for the Kenya Government and was recently contracted to roll out free Wi-Fi to over one thousand, government-funded, incubation hubs in 290 constituencies around the country.
Telkom is 60% owned by Helios, an Africa-focused investment firm, and the Kenya government owns the other 40%. Other investments by Helios in Kenya include Africa Oil, Vivo Energy, and the Wananchi Group. It is also invested in Interswitch which supports financial connectivity services at a dozen Kenya banks and 1,000 ATM’s.
Digital Kenya, by Bitange Ndemo and Tim Weiss, charts the rapid emergence of Kenya in the world of technology. Through stories and interviews with people in the sector, you learn about risk-taking and making policy from humble beginnings back in the mid-1990’s when the whole country shared 32 kbps, and the then telecom Kenya Posts & Telecommunications (KPTC) monopoly declared internet services as being illegal. At the time, KPTC was connecting about 10,000 users to the phone network, and with 77,000 potential customers waiting, they envisioned a 5% tele-density in Kenya by the year 2015. The tele-density in 2015 turned out to be 88% thanks to rapid changes that came after fibre cables and the cheaper mobile phones emerged.
One story is a narration of how, as a peace agreement was being signed in February 2008 to end the post-election violence in Kenya, the ICT Ministry managed to secure a guarantee to enable the laying of the TEAMS fibre cable that ultimately changed the face of ICT in Kenya. This came after the ministry had stepped back from another long-discussed bureaucratic cable project – one called EASSY. This was one of the examples of government officials circumventing red tape for a good outcome. Another was the roll out of M-Pesa which is also cited here, ahead of regulations and thanks to some individuals in government giving it their cautious blessing. Not all of them turned out well, and one case cited is of officials at the Postal Corporation sabotaging a land deal that would have led to the establishment in Nairobi of the headquarters of a multinational telecommunications organization.
There are many other stories that show issues of privatization, race, the lack of vision & finance, tech startups, the need for skills to scale, and the disconnect between local capital & the tech sector. It also shows the disconnect of ICT with both formal banking and also with the agricultural sector, two crucial links yet to be adequately bridged in Kenya.
Thanks to the Ford Foundation, the books is available free of charge and a free book download can be obtained.