M-PESA's Success in Kenya: A Case Study

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M-PESA – A KENYAN SWEET SUCCESS STORY Michael Kinyua
M-PESA – A KENYAN SWEET SUCCESS STORY
Michael Kinyua
Email: kinmichaels@gmail.com
: @kinmichaels
May 2018
Abstract
M-PESA is the world’s most successful money transfer service. It enables millions of people who have
access to a mobile phone, but do not have or have only limited access to a bank account, to send and
receive money, top-up airtime and make bill payments and much more (Vodafone Group Plc, 2017).
Professor Ndung’u further notes that M-PESA is based on a platform of electronic units of money that can
be used for multiple purposes including conversion to and from cash (Ndung’u, 2017).
This evaluation study sought to determine whether M-PESA has met its primary objectives and the
relevance of M-PESA in fulfillment of its goals. This was done through monitoring, where secondary data
was collected on various indicators including customer growth, revenue generation, agent’s growth,
virtual savings, credit supply and value of transactions conducted through M-PESA. In addition, the study
was also done through an extensive review by focusing and emphasizing on the operational aspects of M-
PESA.
The evaluation study found out that M-PESA has made very impressive and remarkable achievements on
the indicators noted above including simplifying the means of transacting money in Kenya. M-PESA
continues to spread it tentacles to every arena of electronic money. It has made huge impacts in
transforming lives and has achieved excellent financial performance. It continue to report positive growth
in M-PESA subscribers, agents and increased volumes in value of transactions carried through M-PESA. Its
products offering are second to none and they continue to evolve as time goes.
Introduction
M-PESA is a disruptive innovative product offered by Safaricom PLC, a leader in telecommunication
services in Kenya and offers a broad range of integrated solutions including voice and data, Short
Messaging Services (SMS), internet and financial services (Safaricom PLC, 2018). According to
Communications Authority of Kenya, as at 31 December 2017, Safaricom PLC registered a market share
of 69.1% in mobile subscriptions and 78% in M-PESA subscribers (Communications Authority of Kenya,
2018).
In its annual reports, Bob Collymore noted that M-PESA continues to be Safaricom’s key platform to drive
financial inclusion. He noted that Safaricom will continue to drive the growth of savings and loans, grow

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cashless payments for businesses through M-PESA and launch new innovative products (Safaricom PLC,
2018). Currently, M-PESA allows a maximum account balance amounting to KShs100,000 (USD1,000)
however, the daily transaction is capped at KShs140,000 (USD1,400) and maximum per transaction
amounts to KShs70,000 (USD700) (Safaricom PLC, 2018).
In its annual reports for 2017. Safaricom PLC noted that it remain focused on ensuring its customers can
access products and services when they want them and how they want them. In addition, Safaricom
indicated that they partnered with Flytxt a mobile consumer analytics solution provider to better
understand its customers’ needs and enable Safaricom PLC to realize its goal of delivering a differentiated,
customer specific experience. Safaricom confirms that these solutions have enabled it to personalize its
services to customers (Safaricom PLC, 2018).
The above two subheadings have dealt with the abstract and the introduction sections of this paper. In
the third section below, the writer will review various M-PESA products offerings by Safaricom PLC. These
includes but not limited to payments for services, international money transfer, savings and loans,
payments for goods and services (Lipa na M-PESA), various value addition, one tap, social impact by M-
PESA, Bamba Chakula, Interoperability, how M-PESA is addressing M-PESA frauds among others. These
products offerings demonstrate the operation excellence and relevant products offered by Safaricom PLC
to its M-PESA subscribers.
In the fourth section the writer analyzes the findings of the evaluation study. The indicators analyzed as
noted above include customer growth, revenue generation, agent’s growth, virtual savings, credit supply
and value of transactions conducted through M-PESA. Secondary data was collected both quantitatively
and qualitatively. The data collected was analyzed using excel, bar and line graphs, trend analysis and by
percentage growth Year over Year (YoY). In some indicators such as revenue generation and value of
transactions conducted through M-PESA, comparison was also made with data collected from the banking
sector in Kenya with a view of demonstrating the excellent performance by M-PESA. The writer further
points out the implications of the analysis for each of these indicators noted above.
The last section of this paper contains the conclusions of the evaluation study, the writer summarizes on
the remarkable successes that M-PESA has achieved. In addition, the writer also adds key highlights of
results from the findings of the evaluation study. The writer further points out some of the deficiencies
that were observed during the study. Included in the last section are areas recommended for further
research.
Review on various M-PESA products
In its Annual Report, Bob Collymore noted that Safaricom Limited continued to be guided by three
strategic pillars including putting Safaricom customer’s first, providing products that are relevant and
optimizing operational excellence. Safaricom further asserts that it is establishing a new relationship with
each of its customers, it strive to achieve this by investing in understanding the customer’s need better
(Safaricom PLC, 2018).
Lagerstedt asserts that long-term shareholder value arises as a result of listening and providing value to
customers and helping them get their jobs done better than the competition while providing a seamless
customer experience. Lagerstedt further notes that if customers are not satisfied with solutions offered,
the business will be affected negatively and shareholder’s value will diminish (Lagerstedt, 2014).

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Safaricom PLC has mastered the art of superior customer service and continues to report positive results
every year. For the last several years, Safaricom prides itself for paying the largest dividend in Kenyan
corporate history (Safaricom PLC, 2018).
Globally, organizations that are customer centric continues to record impressive performance. Amazon is
one such organization. Amazon seeks to be Earth’s most customer-centric company. Amazon is guided by
four principles including customer obsession rather than competitor focus, passion for invention,
commitment to operational excellence and long-term thinking (Amazon.com, Inc., 2016). Amazon
currently ranks at position 12 on the Fortune 500 list (Time Inc., 2017). During the calendar year 2016,
Amazon was ranked at position 18 on the same list which was an improvement from the previous year
rank at position 29. Amazon was also featured and ranked at position 3 on the World’s Most Admired
Companies and at position 44 of the Global 500. Its revenues during year 2015 amounted to over
US$107,006 million and US$135,987 million in 2016 (Time Inc., 2017).
Safaricom PLC appear to emulate Amazon’s focus, the commitment to customer service excellence has
over the years steadily grown its customer base to millions of active and loyal subscribers. The M-PESA
customer growth in numbers from year 2008 to 2018 will be demonstrated later in the findings section of
this paper. Further, the customer service excellence sets Safaricom PLC in the right direction for a
continued exciting performance in the years to come. This section demonstrates the relevant products
offered by Safaricom PLC to its M-PESA subscribers.
Safaricom upgraded its M-PESA platform which now delivers 99.9% availability while processing an
average of 900 transactions per second. In the financial year 2017, Safaricom developed products like M-
PESA Kadogo which attracts no fees for Person to Person (P2P) M-PESA transactions of KShs100 and
below. Safaricom also revised Lipa na M-PESA tariffs to zero for transactions amounting up to KShs200. In
doing all these, Safaricom ensures its customers get enhanced value for their money and also makes small
business more open to use of mobile money payments as well as promoting broad economic participation
and growth (Safaricom PLC, 2018).
As noted above one of Safaricom’s strategic priorities is ‘customer first’. In addressing the concerns raised
by customers for sending money to the wrong persons due to human error while inputting numbers.
Safaricom PLC developed Safaricom App, the App has several services including Hakikisha which now
allows customers to see who they are sending money to before a transaction is initiated. In addition,
customers now have an option of registering for monthly M-PESA statements which enhances
transparency and accountability for M-PESA users. M-PESA has also been enhanced with a Bill Manager
which is an innovation that enables easier bill management from a single portal. M-PESA has a new and
easy to use menu that has consolidated M-Shwari and KCB M-PESA, M-PESA statements, PayBill services,
Real Time Settlements for merchants, and API functionality that enables developers to integrate M-PESA
into their applications and websites (Safaricom PLC, 2018).
M-PESA has an M-Ledger app which is a mobile based app (currently only on android) that runs on a phone
and creates powerful information for M-PESA transactions. M-Ledger helps someone track their finances
by keeping a detailed record of transactions and availing them in an instant whenever they are required.
M-Ledger works by searching through a Database and displaying 6 months of M-PESA history upon
download of the application. This data is then compared with existing M-PESA SMS messages. Graphs are
available on M-Ledger allowing someone to access and represent their information based on Time,
Person, Type and Top-20. In addition M-Ledger allows one to search for Lipa na M-PESA mobile banking

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Bank codes and PayBill numbers. Bank codes and PayBill numbers are downloaded to a device upon first
initiation of the search functionality while Buy Goods numbers are searched Online (Safaricom PLC, 2018).
M-PESA continues to experience growth in cashless payments. M-PESA offers various payments solutions
including Lipa Na M-PESA PayBill, Aggregated PayBill, Bulk Disbursement, Business Payment Services,
SurePay Service, Buy Goods and Services and M-PESA API. One of the most commonly used solution is
Lipa Na M-PESA PayBill, PayBill is a cash collection service that allows an organization to collect money on
a regular basis from its customers through M-PESA. The benefits for using PayBill services include security,
convenience, real time settlement, low cost and ease in reconciliations (Safaricom PLC, 2018). With the
Lipa Na M-PESA services, most people in Kenya do not carry physical cash and questions such as ‘Naweza
Lipa Na M-PESA?’ (Can I make payment via mobile money?) has become common at the point of sale
terminals.
In addition, under the PayBill Services, Safaricom offers unrivalled products such as Changa na M-PESA.
This is a service that allows subscribers to lease a PayBill number for a specific period of time for specific
purposes. Subscribers who need to raise money for medical reasons, education, weddings, funerals,
charity and so on, can use this service in helping to consolidate funds and give well-wishers an easy time.
One can rent a Pay Bill number for any duration between 1 - 6 months which is available for use within 48
hours upon application. It works like a normal Pay Bill account except that the service is short-term.
Leasing a Changa na M-PESA PayBill account does not incur any charges and there are no complications
for the users as the steps used are the same as for the normal PayBill account (Safaricom PLC, 2018).
Moreover, apart from being a secure avenue for holding cash, Changa na M-PESA Pay Bill account has
other great advantages to any subscriber. It represents a one point of funds collection ensuring
accountability since cash is withdrawn to a bank and a statement of funds is availed for audit. It also gives
someone the ability to collect and hold large sums of cash up to KShs100 million whereas the normal
customer number can only hold up to KShs100,000 (Safaricom PLC, 2018).
M-PESA has tripled financial access in Kenya currently as compared to 10 years ago (Safaricom PLC, 2018).
According to 2016 FinAccess Household Survey, access to any form of formal financial service has
dramatically increased from about 27% in 2006 to over 75% in 2016. The survey noted that this inclusion
was driven largely by mobile money services, used by over 71% of adults, as well as mobile banking
services such as M-Shwari, KCB-M-PESA and Equitel. In addition the survey found out that mobile banking
services are already being used by 17.5% of Kenyans and have become the most common banking solution
among youth aged 18 to 25 (FSD Kenya, 2017).
Kenya continues to be recognized globally due to the impact the mobile money has made. As a matter of
fact in September 2017, Kenya was for the third time ranked the top country in a survey on financial and
digital inclusion by a US-based public institution, the top ranking was helped by the wide adoption of
mobile money in the local economy. In its report, The Brookings Institution’s Centre for Technology
Innovation positioned Kenya at the top of its Financial and Digital Inclusion Program (FDIP) scorecard in a
survey of 26 countries across the world. The top ranking was driven by Kenya’s robust commitment to
advancing financial inclusion, widespread adoption of mobile money services among traditionally
underserved groups, an increasingly broad range of mobile money services and an enabling regulatory
environment for digital financial services (Nation Media Group Ltd, 2017).

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M-PESA in the recent past developed a product called Bamba Chakula which has digitized food delivery in
refugee camps such as Kakuma and Daadab. Bamba Chakula enables food delivery to over 100,000
households in the camps which eliminates corruption, reduces cost of distributing relief aid, creates
employment and business opportunities to camp residents and people receiving aid are at liberty to
choose what they want to eat other than queuing for food rations (Safaricom PLC, 2018).
In year 2015, Safaricom partnered with KPMG to apply the KPMG’s True Value methodology. This
methodology “monetizes” the socio-economic and environmental impacts of an organization and its
products and services. Safaricom is the first major company in Africa to monetize and publicly
communicate the value it creates for society in this way (KPMG, 2015).
The KPMG True Value methodology showed that the total value created by Safaricom for the Kenyan
society in its financial year 2015 was estimated at around 10 times greater than the actual financial profit
the company made in the same period. The analysis noted that one of the greatest value the company
creates for the society is through the positive impacts of its M-PESA mobile money transfer service. The
True Value analysis estimated that M-PESA created total societal value of KES 133.8 billion during Financial
Year 2015. The analysis further noted that customers benefited mostly due to increased personal savings,
lower transaction costs and less theft while M-PESA agents and merchants also benefited from increased
sales, reduced operational costs, less theft and fraud and improved ability to track money (KPMG, 2015).
Safaricom’s social impact continues to spread far and wide through the interventions of both Safaricom
and M-PESA foundations. In its annual report for financial year 2017, Safaricom indicated that they
reached to more than four million Kenyans through initiatives that helped eradicate poverty, increased
access to quality education, maternal health care and clean water. Safaricom noted that they achieved
these through partnership with more than 1,200 organizations. Safaricom also noted that the social
impact of M-PESA in 2016 amounted to KShs185 Billions which was through customer’s accessibility to
sending, receiving and saving money freely and jobs created by M-PESA agents (Safaricom PLC, 2018).
Safaricom PLC has robust risk management procedures. It classifies its key risks into strategic and
operational risks. Under operational risks, Safaricom noted in its annual reports for financial year 2016
that just like other organizations, it is exposed to fraud risks both from internal and external sources. To
manage these risks, Safaricom PLC noted that they have Ethics and Compliance team which has put in
place measures to detect, prevent and investigate all fraud cases. All staff are also required to undergo
mandatory annual ethics awareness sessions. Safaricom PLC further noted that externally, it has
experienced cases of M-PESA fraud where third parties have defrauded Safaricom PLC customers and
agents. Safaricom PLC confirms that it continues to closely work with law enforcement authorities to
ensure that these fraudsters are apprehended and arraigned in courts of law (Safaricom PLC, 2018).
In July 2017, Business Daily reported that M-PESA had been the target of fraudsters who explore loopholes
in its processes to steal money from customers. Business Daily indicated that fraudsters had used different
methods, including stolen or forged national identity cards, to register different M-PESA accounts and use
the same to steal funds from other people’s M-PESA accounts. In addition, conmen called customers to
inform them that they had won some money in a competition and through a series of instructions
shepherded unsuspecting users to the point of sending money to the fraudsters as a prerequisite to
accessing their winnings (Business Daily, 2017).

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Business Daily further noted that Safaricom PLC is using a new registration format to enhance its database
and lift its customer security levels to those of commercial banks. Business Daily also noted that mobile
money agents were to soon start using photos to identify those withdrawing or depositing money on the
popular M-PESA platform in a new push to curb fraud (Business Daily, 2017).
In addition, Business Daily indicated that Safaricom PLC said it had distributed about 25,000 pre-
programmed smartphones to its mobile money agents to be used in registration of new SIM cards. The
process involves capturing faces of SIM card owners and storing digital copies of the same for retrieval
during M-PESA transactions. In the article, Safaricom noted that the special phones in use for registration
are linked to the Registrar of Persons’ database, helping verify the data as it is fed into the system.
Safaricom indicated the digital database, which is also being populated with photos of existing subscribers,
should ease service delivery as agents and customer care representatives need not ask for proof of
identity prior to allowing a transaction (Business Daily, 2017).
The Business Daily also noted that they established that M-PESA agents will be conducting all transactions
through the company-issued mobile phones, allowing them to validate the national ID card details
presented to them and the person doing so. Business Daily reported that Safaricom noted the big win
from this process is that the photo evidence of the person registering will eliminate use of stolen personal
identification documentation to commit fraud (Business Daily, 2017).
M-PESA offers International Money Transfer (IMT) services. Registered M-PESA users in Kenya can; send
money to MTN Subscribers in Uganda, send and receive money from MTN Subscribers in Rwanda and
send and receive money from Vodacom subscribers in Tanzania (Safaricom PLC, 2018). In addition, M-
PESA provides M-PESA PayPal Services which is offered to M-PESA customers by TransferTo in partnership
with Safaricom and PayPal (Safaricom PLC, 2018). PayPal is a service that provides an easy and quick way
to send and request money online. One can transfer money globally to family, friends, online shops, and
auction sites like eBay without revealing one’s financial details (PayPal Pte. Ltd, 1999-2018).
In 2017 M-PESA released an updated API that allows businesses and online payment platforms to easily
integrate with M-PESA. Safaricom PLC stated that ‘qualifying’ M-PESA customers in Kenya can link their
PayPal accounts to their M-PESA wallets, enabling them to easily and securely buy goods and services
from merchants around the globe. Safaricom’s Director of Strategy, Joseph Ogutu indicated that this
development injects speed and convenience, “through which more entrepreneurs and consumers can
benefit from the growing e-commerce industry.” (Capital Group Limited, 2017).
Other innovative and revolutionary M-PESA products includes M-Shwari and KCB M-PESA. M-Shwari is a
paperless banking service offered through M-PESA that enables someone to open and operate an M-
Shwari bank account through a mobile phone and through M-PESA, without having to visit any bank to fill
out bank account opening forms. It provides someone with the ability to move money in and out of an M-
Shwari savings account to someone’s M-PESA account at no charge. It gives someone an opportunity to
save as little as KShs1 and earn interest on the saving balance. This cash is moved into the savings account
using a handset via the M-PESA Menu (Safaricom PLC, 2018).
M-Shwari is a partnership between Safaricom PLC and Commercial Bank of Africa (CBA). CBA notes that
M-Shwari is coined from a Swahili word that means smoothen or make something better or good. CBA
further indicates that the "M" signifies mobile centric as this product is operated entirely from a mobile
phone. In Addition, CBA says that with M-Shwari, one has access to Deposit and Loan products that are

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convenient, reliable and cost-effective for making micro-savings and taking micro-loans (Commercial Bank
of Africa, 2018). M-Shwari was introduced in 2012 and M-Shwari customers can borrow a loan ranging
from KShs100 to KShs100,000 (TUKO Media Ltd, 2016).
Similar to M-Shwari is another game changer in the banking industry, the KCB M-PESA which was
introduced in the Kenyan Market in 2015. This is a mobile based account offered exclusively to M-PESA
customers by Kenya Commercial Bank (KCB). It enables someone to access loans at attractive low interest
rates of 1.12% per month with a one off negotiation fee of 2.5% (KCB Group Limited, 2018). In addition,
one can access loan limits from as low as KShs50 and up to KShs1M with a repayment period of 30 days.
KCB M-PESA also provides someone with an opportunity to save funds either in fixed or target saving
accounts. Funds in these accounts can be locked or targeted for periods of 1, 3, 6 and 12 months
(Safaricom PLC, 2018).
Other recent development in the M-PESA field include M-PESA 1 tap. According to Safaricom PLC, M-PESA
1Tap is the faster way to pay with MPESA. Using a card, phone sticker or wristband device that is
connected to your M-PESA account, you can easily and securely make Lipa Na M-PESA Buy Goods and
Services payments. With M-PESA 1Tap, one simply taps, enters a PIN to pay and goes! In addition, it
reduces the number of steps from 8 to just 1 (Safaricom PLC, 2018). The option of using a card under M-
PESA 1 tap is almost similar to electronic card payments including debit and credit cards that are largely
offered in the banking sector.
Bolt and Chakravorti asserts that, compared with cash, electronic payments offers benefits in terms of
greater security, faster transactions, and better record keeping. In addition they noted that, electronic
payments offers possible access to credit lines (Bolt & Chakravorti, 2008). The card services offered by M-
PESA 1 tap appears to be quite appealing and in the right direction of electronic cards payments platforms.
Further, innovations on the same appears imminent in years to come.
In June 2016, the ICT Authority developed the Kenyan National ICT Policy. This policy indicates that the
national regulations made specific provisions for mobile money interoperability standards from an
infrastructure perspective. In order to drive financial inclusion, it noted that the Government of Kenya
among other things encouraged mobile operators to share mobile money infrastructures including agent
networks on transparent, fair and non-discriminatory basis and proposed to provide incentives to mobile
operators in cases where sharing mobile money infrastructures would expose them to return on
investment risks (ICT Authority, 2016).
In driving the financial inclusion agenda in Kenya, M-PESA and Airtel money subscribers effective 10 April
2018 were able to seamlessly send and receive money following the success of mobile money
interoperability test. In a joint statement, Safaricom PLC, Airtel, and Telkom noted that this would also
empower customers through a more integrated mobile money eco-system. The new technology means
that funds can move directly from the sender’s wallet to the recipient’s wallet. With this move, Kenya
joined 15 other countries across the world that have successfully implemented wallet-to-wallet
interoperability (Obura, 2018).
According to eServGlobal, Interoperability will play a key role in the continued expansion of mobile
money. In addition eServGlobal noted that a lack of interoperability has been highlighted as a major
barrier to the development of the mobile money market. eServGlobal asserted that the strongest reason
for enabling interoperability is the dramatic increase in mobile money transactions that will result. Ovum

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Research as cited in (eServGlobal, 2017), indicated that transaction volumes in any network is
proportional to and driven by the number of interconnections possible between subscribers. In addition,
interoperability would give mobile money service providers the opportunity to increase the volume of
digital transactions, improve the sustainability of mobile money services and contribute to an open digital
financial ecosystem which promotes financial inclusion (eServGlobal, 2017).
This section has focused on the key products offered by M-PESA which has numerous other products on
offer. They keep evolving and during the press release for its annual reports for 2018, Bob Collymore
indicated that Safaricom PLC continues to improve the customer experience on M-PESA through system
enhancement, additional security features and mySafaricom App (Safaricom PLC, 2018). It will be
interesting to see new M-PESA products in future.
Findings
The trend of excellence performance appears and is expected to continue to unfold to unrivalled realms
in the industry. The next section of this paper will demonstrate this success story in figures for various
indicators as noted in the abstract and introduction sections above.
M-PESA subscribers Growth
Table 1 below shows the number of Safaricom PLC mobile and M-PESA subscribers from year 2007 to
2018. In addition the table also shows Year over Year percentage increases for M-PESA registered
customers and the percentages of M-PESA subscribers as compared to total Safaricom PLC mobile
subscribers. M-PESA was launched on 6 March 2007, one year later, M-PESA had registered 2 Million
subscribers. The M-PESA subscribers has considerably grown from 2.08 to 28.64 million subscribers within
a period of 11 years which represent a growth of 1,277%.
Further, the number of Safaricom PLC mobile subscribers registering for M-PESA has also substantially
increased. In year 2008 only 20% had registered while in year 2018, 97% had registered on M-PESA. This
demonstrates the attractiveness of M-PESA to Safaricom PLC mobile subscribers.
Table 1: Safaricom PLC mobile and M-PESA subscribers from year 2007 to 2018
Transaction
type
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Mobile
subscribers
(in Million)
6.10 10.23 13.36 15.79 17.18 19.07 19.42 21.57 23.35 25.16 28.13 29.57
M-PESA
subscribers
(in Million)
2.08 6.18 9.48 13.80 14.91 17.11 19.30 20.60 23.65 26.57 28.64
Year over
Year (YoY)
%age
increase
increase of
M-PESA
197% 53% 46% 8% 15% 13% 7% 15% 12% 8%

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registered
customers
%age of
mpesa
subscribers
as compared
to total
Safaricom
PLC mobile
subscribers
0% 20% 46% 60% 80% 78% 88% 89% 88% 94% 94% 97%
Source: Safaricom published Annual Reports
Diagram 1 below depicts that in a few years to come, all Safaricom PLC mobile subscribers will have
registered for M-PESA.
Diagram 1:
According to Kenya National Bureau of Statistics (KNBS) in year 2016, the population of Kenya was 45.4
million people. The statistics further showed that, more than half of the Kenyan Population was in the age
brackets of 0-19 years this accounted to 23.7 million people. Thus the Kenyan population aged 20 years
and above amounted to 21.7 million people (Kenya National Bureau of Statistics, 2018). In 2016, there
were 23.65 million M-PESA subscribers as shown on table 1 above. From the KNBS and M-PESA
subscription statistics, it is therefore evident that M-PESA has more subscribers than Kenyans aged 20
years and above. This implies that M-PESA is a product that has been subscribed in every household in
Kenya and it appeals to every adult in the Kenyan populace.
2.08 6.18
9.48
13.80 14.91 17.11 19.30 20.60
23.65
26.57 28.64
6.10
10.23
13.36
15.79 17.18
19.07 19.42
21.57
23.35
25.16
28.13
29.57
-5
0
5
10
15
20
25
30
35
40
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Subscribersinmillion
Year
Safaricom PLC Mobile and M-PESA subscribers chart for year 2007 - 2018
MPesa Customers (in Million) Mobile subscribers (in Million)
Linear (MPesa Customers (in Million)) Linear (Mobile subscribers (in Million))

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Revenues generated from M-PESA
Table 2 below shows the revenues generated from M-PESA. One year after the launch of M-PESA in 2007,
M-PESA revenues amounted to KShs370 million. The revenues have increased drastically and in year 2018,
the revenues amounted to KShs62.9 billion. This represents growth by 16,900% in revenues as compared
between year 2008 and 2018. From table 2 below, it is evident that M-PESA has had a steady growth over
the years with the least growth year over year being 14% that was reported in year 2018. This was largely
so because of the general elections in Kenya in year 2017.
Table 2: M-PESA revenues from year 2008 to 2018
Transaction
type
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Revenues
from Mpesa
(amt in KES in
Billion)
0.37 2.93 7.56 11.78 16.87 21.84 26.56 32.63 41.50 55.08 62.90
Year over
Year (YoY)
%age
increase of
Revenues
from M-PESA
692% 158% 56% 43% 29% 22% 23% 27% 33% 14%
As shown on Table 3 below, from calendar year 2011 to 2016, the banking sector in Kenya continued to
record positive increases in total gross income. By the end of calendar year 2011 there were a total of 43
banks in Kenya whose cumulative gross income amounted to KShs256.3 billion. For the calendar year
2016, the gross income amounted to KShs502 billion (Central Bank of Kenya, 2017). Thus gross income in
2016 grew by 96% as compared to that of 2011. For M-PESA, during the same period, the total income/
revenues grew by 226%. I.e. from KShs16.87 billion for year ending 31 March 2012 to KShs55.08 billion
for year ending 31 March 2017. M-PESA has therefore experienced a more robust growth as compared to
the growth in the banking sector which offers similar and much more services than M-PESA.
According to Central Bank of Kenya (CBK), Kenyan commercial banks are classified into three peer
groups using a weighted composite index that comprises net assets, customer deposits, capital and
reserves, number of deposit accounts and number of loan accounts. A bank with a weighted-
composite index of 5 percent and above is classified as a large bank. A medium bank has a weighted
composite index of between 1 percent and 5 percent while a small bank has a weighted composite
index of less than 1 percent. For the period ended 31st December 2016, there were 8 large banks with
a market share of 65.32 percent, 11 medium banks with a market share of 25.90 percent and 20 small
banks with a market share of 8.77 percent as shown in Table 3 below (Central Bank of Kenya, 2017).
In year 2016, the total banking sector income amounted to KShs502 billion as shown on table 3 below.
Assuming that this was shared according to the market share for pretax profit across the three peer
groups, the total income was shared as follows; KShs371 billion for 8 tier 1 banks, KShs120 billion for 11
tier 2 banks and KShs11 billion for 20 tier 3 banks. In addition, assuming that the total income was evenly

11
distributed for banks within their respective peers, the analysis on table 3 implies that the average income
for the year ending 31 December 2016 for each of the 8 tier 1 banks amounted to KShs46.4 billion,
KShs10.9 billion for each of the 11 tier 2 banks and KShs552.2 million for each of the 20 tier 3 banks.
M-PESA revenues for the year ending 31 March 2017 amounted to KShs55.08 billion which is 19% higher
than what an average tier 1 (large) bank in Kenya generated in income amounting to KShs46.4 billion for
the year ending 31 December 2016. In comparison with tier 2 banks, during the same period, M-PESA
revenues were higher by 400% of the average income amounting to KShs10.9 billion. Some of the banks
in Kenya have been in existence for more than 100 years whereas M-PESA has only been in the market
for 11 years. This trend indicates that M-PESA is expected to generate significantly higher revenues than
any individual bank in Kenya irrespective of the peer group. As shown on table 2 above and table 3 below,
the M-PESA revenues have grown at a much higher rate year over year as compared to the growth of
income in the banking sector.
In comparison with tier 3 banks, M-PESA revenues amounting to KShs55.08 billion was 400% more than
what 20 banks in tier 3 generated in income amounting to KShs11 billion for the similar period (year ending
31 December 2016). The 20 banks have a combined asset base amounting to KShs312 billion (Central Bank
of Kenya, 2017). M-PESA is therefore a force to reckon with in the banking sector.
Table 3: Kenyan Banking Sector Income and Expenditure, profit before tax and market share
2011 2012 2013 2014 2015 2016
KShs. M KShs. M KShs. M KShs. M KShs. M KShs. M
Total sector Income 256,336 356,306 362,176 418,698 474,856 501,968
Year over Year (YoY) %age
increases 39% 2% 16% 13% 6%
Total Expenses 166,881 248,406 236,417 277,552 341,940 354,890
Profit Before Tax 89,455 107,900 125,759 141,146 134,017 147,445
Market share
Tier 1 - large 54.6% 53.7% 52.4% 49.9% 58.21% 65.32%
Tier 2 - Medium 36.0% 36.8% 39.1% 41.7% 32.42% 25.90%
Tier 3 - Small 9.4% 9.5% 8.5% 8.4% 9.24% 8.77%
100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Pre-Tax profit share
Tier 1 - large 62.30% 65.50% 62.80% 61.00% 70.30% 73.90%
Tier 2 - Medium 33.20% 32.50% 33.10% 35.80% 26.40% 23.90%
Tier 3 - Small 4.50% 2.00% 4.10% 3.20% 3.30% 2.20%
100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

12
2011 2012 2013 2014 2015 2016
KShs. M KShs. M KShs. M KShs. M KShs. M KShs. M
No of banks in Kenya
Tier 1 - large 6 6 6 6 7 8
Tier 2 - Medium 15 15 16 16 12 11
Tier 3 - Small 22 22 21 21 21 20
43 43 43 43 40* 39*
*Excludes banks under
receivership and
statutory management
Average total gross income share using pretax profit share %ages
Tier 1 - large 159,697.33 233,380.43 227,446.53 255,405.78 333,823.77 370,954.35
Tier 2 - Medium 85,103.55 115,799.45 119,880.26 149,893.88 125,361.98 119,970.35
Tier 3 - Small 11,535.12 7,126.12 14,849.22 13,398.34 15,670.25 11,043.30
256,336.00 356,306.00 362,176.00 418,698.00 474,856.00 501,968.00
Average gross income amount per bank*
Tier 1 - large 26,616.22 38,896.74 37,907.75 42,567.63 47,689.11 46,369.29
Tier 2 - Medium 5,673.57 7,719.96 7,492.52 9,368.37 10,446.83 10,906.40
Tier 3 - Small 524.32 323.91 707.11 638.02 746.20 552.16
Source: Central Bank of Kenya
* For purpose of this analysis. The writer has assumed a uniform distribution of revenues across peer
groups. Some banks generate more income than the average where as some make significantly less.
According to Levitt 1965 as cited on (Cao & Folan, 2015); diagram 2 below shows a product development
cycle which demonstrates the life story of most successful products as they pass through certain
recognizable stages. Levitt asserts that under stage 1 - market development is when a new product is first
brought to market, before there is a proved demand for it, and often before it has been fully proved out
technically in all respects, he further notes that sales are low and creep along slowly on this stage. In stage
2 – market growth, Levitt notes that demand begins to accelerate and the size of the total market expands
rapidly. He also notes that this stage might also be called the “Takeoff Stage.” Under stage 3 - market
maturity, Levitt notes that demand levels off and grows, for the most part, only at the replacement and
new family-formation rate. Stage 4 - market decline is the final stage which Levitt indicates that the
product begins to lose consumer appeal and sales drift downward (Levitt, 1965).

13
Diagram 2: Product lifecycle Theory
Source: Levitt, 1965 as cited on (Cao & Folan, 2015)
Diagram 3 below shows the product lifecycle for M-PESA. In order to determine what stage M-PESA is at,
it is important to understand the features in the various stages. Levitt notes that the usual characteristic
under market growth is a gradual rise in its sales curve during the market development stage. At the
beginning of stage 2, Levitt indicates that competitors who have been watching the development in stage
1 enter into the market. The ensuing fight for customer patronage poses a challenge for the originator on
brand preference on its customers. Other features in stage 2 includes cost reduction due to economies of
scale, sales volume increases significantly, profitability rises, increased public awareness and cost
reduction due to competition (Levitt, 1965).
For the last four years, M-PESA revenues have grown at an increasing rate as shown on table 2 above. I.e.
M-PESA grew by 22%, 23%, 27% and 33% in years 2014, 2015, 2016 and 2017 respectively representing a
significant increase in revenues. As noted earlier, Safaricom revised Lipa na M-PESA tariffs to zero for
transactions amounting up to KShs200 due to economies of scale and competition. M-PESA also has
significantly high levels of public awareness as demonstrated by the uptake of M-PESA. Indeed 97% of
Safaricom PLC mobile subscribers have also subscribed for M-PESA as at the end of 31 March 2018.
Further, 28.64 million subscribers represents over 50% of the total population of Kenya and as noted
earlier, M-PESA has more subscribers than Kenyans aged 20 years and above.
The Mobile money transfer market has also seen new entrants in the recent past. In August 2014, Equity
bank launched Equitel which offers similar services to M-PESA. By 2015, Equitel was the second largest
money service provider in Kenya in terms of transaction values (Nation Media Group Ltd, 2017). On 16
February 2017, Kenya Bankers Association (KBA), the umbrella body of the banking industry, unveiled the
PesaLink brand and kicked-off a phased rollout of the digital payments platform (Integrated Payment
Services Limited, 2017). PesaLink can handle person-to-person transfers from as low as KShs10 to a high

14
of KShs999,999. According to Mr Brian Ngugi, PesaLink was launched and expected to rival Telco’s mobile
money service currently dominated by Safaricom PLC’s M-PESA (Nation Media Group Ltd, 2017).
Other mobile apps competing with M-Shwari and KCB M-PESA includes, Tala, Saida, Branch, Pesa Pata,
Kopa Chapaa, Pesa Zetu. Jumo/ Kopa Cash, Timiza, among others. All these features correspond to
characteristics of a stage 2 on the product life cycle development. In conclusion, M-PESA is therefore in
the growth stage. The M-PESA revenues performance in the coming years will determine if M-PESA
lifecycle will enter the maturity stage or continue on growth stage.
Diagram 3: M-PESA Revenues chart (M-PESA product lifecycle progress)
Agents’ growth
Table 4 below shows the number of M-PESA agents for the period 2008 to 2018. In year 2008 there were
2,262 M-PESA agents. In the following two years, the number of agents recorded the highest growth rate
by 282% and 104% in 2009 and 2010 amounting to 8,650 and 17,652 respectively. By the end of 31 March
2018, the number of M-PESA agents amounted to 156,534. According to provisional data provided by
Safaricom PLC to Communications Authority of Kenya for the period ending 31 December 2017, M-PESA
had registered 152,077 agents representing 76.7% of total number of mobile money agents in the Kenyan
market amounting to 198,234 agents (Communications Authority of Kenya, 2018).
In addition, Central Bank of Kenya (CBK) indicated that, By December 2016, 18 commercial banks and 5
Microfinance Banks (MFBs) had contracted 53,833 and 2,068 agents, respectively, spread across the
-
10.00
20.00
30.00
40.00
50.00
60.00
70.00
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
M-PESARevenuesinbillion
Period in years
M-PESA REVENUES CHART

15
country. In the previous year, December 2015, CBK noted that the number of agents contracted by
commercial banks and MFBs were 40,592 and 1,154 respectively (Central Bank of Kenya, 2017). M-PESA
therefore has much more agents as compared to the entire banking sector in Kenya.
Safaricom PLC notes that, the M-PESA agents ensures accessibility of M-PESA services to its customer base
and continued expansion of services in line with demand. As noted earlier, jobs created through M-PESA
agents have contributed significantly to the social impact of M-PESA (Safaricom PLC, 2018). According to
Kenya National Bureau of Statistics (KNBS) the number of new jobs created in the formal sector were 110
thousand in 2017 compared to 84.8 thousand jobs created in 2016. In addition the informal sector which
constituted 83.4 per cent of the total employment, created 787.8 thousand new jobs in 2017 and 747.2
thousand in 2016 (Kenya National Bureau of Statistics, 2018). From table 4 below it is evident that the
growth of M-PESA agents has significantly contributed to directly creating new jobs in the Kenyan
economy.
Table 4: No of agents and year on year percentage growth from year 2008 to 2017
Transaction
type
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
No of
Mpesa
agents
2,262 8,650 17,652 26,948 39,400 65,547 81,025 85,756 100,744 135,544 156,534
Year over
Year (YoY)
%age
increase of
M-PESA
agents
282% 104% 53% 46% 66% 24% 6% 17% 35% 15%
Virtual savings and credit supply
M-Shwari was launched on 27 November 2012. M-Shwari as noted earlier is a banking product for M-PESA
customers offered by Commercial Bank of Africa (CBA) in partnership with Safaricom PLC (Safaricom PLC,
2018). In December 2017 Safaricom PLC and CBA celebrated five years since M-Shwari was introduced in
the Kenyan market. M-Shwari was rolled out as a credit facility for those who have been locked out of the
loans market for lack of collateral and credit history. It was positioned as a pioneer financial service that
promotes a culture of saving among ordinary Kenyans and allows those with no collateral to access loans
through their mobile phones (Business Daily News Desk, 2017).
As at 31 March 2016, M-Shwari increased 30 day active customers to 3.9 million, with KShs8.1 billion on
deposit and KShs7.4 billion on loans with Non-Performing Loans (NPLs) at 1.93% (Safaricom PLC, 2016).
As at March 2017, the total cumulative loans issued under M-Shwari stood at KShs7.37 billion per month.
During the 5 year celebrations, Mr Isaac Owundo the Managing Director of CBA noted that within 41 days
of the launch of M-Shwari in 2012, it had enrolled more than 1 million customers, this he noted was one
of the fastest growth in customer acquisition in the world. In Addition Mr Owundo indicated that by 5
December 2017, M-Shwari had registered 21.1 million customers with over KShs230 billion disbursed in
loans since its launch. Total deposit for the same period amounted to over KShs669 billion that had been
received through the saving option of M-Shwari (Business Daily News Desk, 2017).

16
During the 5 year celebrations, Ms Sylvia Mulinge also added that the transformation that Safaricom PLC
has observed on the lives of its customers has been amazing. She noted that 75% of the Kenyan adult
population have utilized the M-Shwari product at least once in their life. She further noted that M-Shwari
was constructed as a saving led product which encourages the right kind of culture and behavior in M-
Shwari customers, such that customers do not just pursue credit for the sake of credit but that they are
also active in savings which has changed the saving culture in Kenya (Business Daily News Desk, 2017).
In April 2015, Tamara Cook and Claudia McKay asserted that M-Shwari represented the next frontier of
digital financial services as it demonstrates that mobile money infrastructure can be leveraged to offer
higher value financial products at scale. They further indicated that M-Shwari has piqued the interest of
mobile money watchers looking for the next innovation to drive financial inclusion globally. They
explained that M-Shwari has already brought millions of poor, previously unbanked Kenyans the full
benefits of a banking product (including interest, deposit insurance, and access to credit) using M-PESA’s
unparalleled mobile money infrastructure. M-Shwari is also the first large-scale product that taps into
digital information (in this case, telecommunication data) of poor and unbanked customers in an emerging
market to make credit-scoring decisions (Cook & McKay, 2015).
Tamara Cook and Claudia McKay also indicated that the M-Shwari product allows customers to save for
the short term while also increasing access to credit options in the future, which makes customers feel
that their funds are “working” for them. In addition, the product is easy to figure out and highly engaging
as it rewards customers for “good” behavior quickly. They indicated that the fast, virtual nature of the
product intensifies the usual challenges of customer education and disclosure but represents an
unprecedented new channel of access to short-term loans and secure savings for a swathe of the
population who have not had previous access to formal financial services (Cook & McKay, 2015).
On 10 March 2015, Safaricom and Kenya Commercial Bank (KCB) jointly launched the KCB M-PESA
account. In three weeks, KCB M-PESA account had registered 640,000 subscribers which translated to
40,000 sign-ups per day. In that same period, customers deposited KShs36 million, borrowed KShs380
million and KShs90 million was moved from M-PESA to the KCB M-PESA. KCB M-PESA is accessible by all
M-PESA users through the SIM toolkit or Safaricom app. The KCB M-PESA account has more features than
M-Shwari. With KCB M-PESA customers can access a maximum loan amounting to KShs1 million while M-
Shwari maximum loan amounts to KShs100,000 (Wasike & Mulanga, 2015).
During the calendar year ended 31 December 2017, KCB reported 88.8 million mobile transactions
including KCB M-PESA and KCB app which was an increase by 67% from the previous year’s transaction
amounting to 53.1 million. During the same Period, KCB reported mobile loan disbursements amounting
to KShs29.6 billion which was an increase by 110% as compared to disbursements made in the previous
year ending 31 December 2016 amounting to KShs14.1 billion (KCB Group Limited, 2018). In November
2017, during the highlight for KCB 2017 Q3 results, Mr Oigara noted that since the inception of the flagship
KCB M-PESA platform in March 2015, the Bank had disbursed over KShs20.3 billion in loans to over 8
million customers on their mobile phones (KCB Group Limited, 2017).
Mr Oigara in a previous statement noted that as one of the pioneering mobile loan services in East Africa,
KCB M-PESA is a revolutionary mobile solution to the unbanked, enhancing the financial inclusion agenda
of the bank. He indicated that statistics showed that at least 40% of the loans processed through KCB M-
PESA were below KShs500 and 57% were below KShs1,000. This he asserted is an indicator that the service
was and continues to provide affordable finance to users across all income levels (Safaricom PLC, 2017).

17
In conclusion the cumulative M-PESA subscribers using KCB M-PESA and M-Shwari amounts to more than
29 million users with cumulative loans disbursed amounting to over KShs250 billion by November 2017.
This demonstrate how appealing M-Shwari and KCB M-PESA as an innovative mobile products have been
in the Kenyan market. This as noted earlier has seen many other entrants in the markets competing to
offer similar services.
According to a survey conducted by Kenya National Bureau of Statistics (KNBS) in regards to the preferred
source of credit in Kenya, the survey showed that merchants or shops were the most common (28.2%)
source of credit followed by self-help groups/ chamas (19.4%), and relatives, friends and neighbors
(14.0%). Among the formal sources, Savings and Credit Co-operative Societies (SACCOs) were the most
popular (11.2%) followed by commercial banks (8.8%), mobile phone platform (7.6%) Micro-Finance
Institution (5.3%) and others (employers, shylock, NGOs, government funds etc.) with less than 1.5% each
(Kenya National Bureau of Statistics, 2018). Thus a great opportunity exists for offering credit via mobile
money. The mobile phone platform thus need to keep evolving and offer appealing credit products in
order for it to be a preferred source of credit in Kenya.
Value of transactions
As noted earlier, the upgraded M-PESA platform now delivers 99.9% availability while processing an
average of 900 transactions per second. The transaction value per year since 2008, one year after M-PESA
was launched is shown on table 5 below. For period ending 31 March 2008 M-PESA transacted KShs14.8
billion. For the financial year ending 31 March 2018, the value of transaction carried through M-PESA
amounted to KShs8,114 billion (Safaricom PLC, 2018). This represents a growth by 54,724% demonstrating
how M-PESA has well been adopted by the Kenyan populace in their day to day life of transacting money
over the years.
According to report published by Communications Authority of Kenya (CA) for the period October to
December 2017. The total number of mobile money transactions effected through M-PESA amounted to
493,063,124 transactions, whereas the total number in the entire sector amounted to 607,413,494
transactions (Communications Authority of Kenya, 2018). This means that for every 10 transactions being
completed in the Kenyan mobile money market, 8 transactions are from M-PESA.
From the other indicators noted earlier, the value of transaction completed via M-PESA has yielded the
highest growth amounting to 54,724% in comparison with year 2008 and 2018 figures. The percentage
growth of M-PESA revenues, agents and subscribers for the same period amounts to 16,900%, 6,820%
and 1,277% respectively. This implies that the greatest success that M-PESA has achieved to date has been
derived from the increased value of transactions. There are more use cases by an M-PESA subscriber
currently than 11 years ago. In addition, even if there is no significant growth in M-PESA subscribers, M-
PESA can still enjoy increased value of transaction as existing subscribers use M-PESA more in their
transactions.
During the 2018 financial results presentation, Bob Collymore noted that Safaricom PLC continued
democratizing M-PESA and enhancing use cases for long-term sustainability of its payments ecosystem.
Safaricom PLC reduced the Lipa Na M-PESA merchant fees by 50%, and scrapped transaction fees for
amounts less than KShs200 in order to encourage adoption of the service, which Safaricom PLC views as
a huge untapped opportunity. As a result, Safaricom PLC now has more than 101,000 active merchants, a
growth of 76.6% year over year, and over 147.6 million Lipa Na M-PESA transactions, up 63.5% year over

18
year. Bob Collymore further noted that for the long-term sustainability of this ecosystem and business
stream, it is important that new use cases are continually created to enhance the velocity of transactions
and to keep the e-money circulating within the system (Safaricom PLC, 2018).
The creation of new use cases appears to be one the greatest opportunity that Safaricom PLC needs to
pursue in order to continue increasing the value transacted via M-PESA. Indeed this assertion is supported
by the survey findings conducted by Kenya National Bureau of Statistics (KNBS) for the 2015/16 Kenya
Integrated Household Budget Survey and specifically cash transfer in Kenya. This survey found that 33.5%
of households received cash transfers in Kenya. Further, the households in rural areas received a higher
proportion amounting to 40.2% as compared with those in urban areas who received 24.8% (Kenya
National Bureau of Statistics, 2018).
The survey by KNBS further indicated that the transfers were completed either through formal channels
including banks, money transfer agents and mobile money transfer agents or through informal channels
of cash transfers outside the official regulation and supervision. The majority of households received cash
transfers through mobile money transfer which accounted for 43.7%. Other preferred modes of transfer
were through family or relative at 39.8%, commercial banks at 17.5%, money transfer agents at 11% and
neighbor/ friend at 10.3%. In addition the survey also found out that mobile money transfer was used
more by households in rural areas amounting to 46.2% as compared to those in urban areas amounting
to 38.9% (Kenya National Bureau of Statistics, 2018).
At only 43.7% share of all transfers being carried via mobile money, this confirms that there is an untapped
opportunity for the mobile money to significantly increase transfer of cash through mobile money to a
higher proportion by providing even more appealing and innovative reasons for the Kenyan populace to
adopt M-PESA while transferring money. Further, numerous transactions happens at the point of sale as
customers buy goods from various traders. Quite a number of traders are not registered M-PESA
merchants, however they accepts various forms of cards payment including debit and credit cards. The
big question is whether M-PESA can consider exploring if it is able to offer its customers debit or credit
cards as a means of payment at the various point of sales.
Table 5: Value of transactions completed through M-PESA
Transaction type 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Value of transactions
completed through M-
PESA (amt in KES in Billion)
14.80
120.61
405.52 1,301 2,061 2,636 3,321 4,181 5,290 6,869 8,114
Year over Year (YoY) %age
increases of value of
transactions completed
through M-PESA
715% 236% 221% 58% 28% 26% 26% 26% 30% 18%

19
Conclusion
Indeed Safaricom PLC’s slogan sums it up that ‘Twaweza - When we come together, great things happen’.
As a matter of fact, this M-PESA success story is nothing short of the great things that have happened in
the Kenyan populace from the time M-PESA was launched into the market. M-PESA has not only become
a way of life but it enables and transforms lives (Safaricom PLC, 2018). Many M-PESA subscribers have
been able to avoid queuing in banking halls for most of the bills payments simply by using M-PESA hence
saving substantial amount of time.
Safaricom PLC appears to be doing everything right about M-PESA. M-PESA has come of age and as Bob
Collymore notes that when the name of a brand or product becomes a by-word or an accepted English
verb, then it has impacted the culture. M-PESA has reshaped Kenya’s banking and telecom sectors, and
extended financial inclusion for nearly 20 million Kenyans. M-PESA has also brought some interesting
adages in the Kenyan day to day lives such as; ‘I will M-PESA you’, ‘please M-PESA me’ and ‘Tuma na ya
kutoa’. The three adages can be interpreted as; I will send you the money, please send me money and
kindly include withdrawal fees respectively (Safaricom PLC, 2018).
M-PESA has shown tremendous growth on all the indicators studied. Its products keep evolving with new
and innovative ones being introduced to the market regularly which is a testament that mobile money
provides numerous solutions in the current day and age. The M-PESA subscribers have seen enormous
growth and as at 31 March 2018 there were almost 29 million subscribers which is more than half the
Kenyan population (Safaricom PLC, 2018). As noted earlier, the writer observed that M-PESA subscribers
are significantly more that Kenyans aged 20 and above. Thus new subscribers will largely be experienced
by targeting persons transitioning from teenage to adulthood in Kenya.
The M-PESA revenues have already crossed the KShs60 billion mark and growing, a level that many group
of companies in East and Central Africa can only dream of. The value of transaction carried through M-
PESA by the end of 31 March 2018 has surpassed the Kenyan Gross Domestic Product. As more M-PESA
use cases continue to be discovered, the value transacted will continue to increase and it will be
interesting to see what this figure will be in years to come. M-PESA has also been in the forefront for
creating new jobs both directly and indirectly especially through the M-PESA agents (Safaricom PLC, 2018).
M-PESA is truly an agent of transforming lives in Kenya and many people can attest to this.
One of the deficiency observed during the study is the limited threshold per single M-PESA transaction
amounting to KShs70,000 and the maximum daily transaction capped at KShs140,000. As compared to
PesaLink with transaction limit amounting to KShs999,999. For M-PESA to remain competitive there is
need for review of these limits. As noted during the study, Safaricom has indicated that plans are
underway to raise the daily transaction limit. It will be interesting to see how this plays out when it is
rolled into the market (Business Daily News Desk, 2017).
Further research will need to be carried out on how M-PESA can create more use cases which will in turn
increase the value of transactions carried through M-PESA resulting to increased M-PESA revenues. In
addition as M-PESA continues evolving and developing relevant products, these products and services
requires that Safaricom PLC continuously comply with a wide range of rules and laws from major
regulators namely Communications Authority of Kenya (CA), Competition Authority of Kenya (CAK) and
Central Bank of Kenya (CBK) (Safaricom PLC, 2018). M-PESA will also need to research how to thrive in
these regulatory environments without any negative impacts on its operations and opportunities.

20
From the study, it was quite evident that M-PESA has satisfactorily met its objectives, moreover, M-PESA
is so customer-centric that once you get hooked on it, there is no letting go. The indicators evaluated on
this study recorded very impressive growth rates from inception to the current period. As noted earlier,
the percentage growth of M-PESA revenues, agents, subscribers and value of transaction carried through
M-PESA amounted to 16,900%, 6,820%, 1,277% and 54,724% respectively, within a period of only 11
years, this kind of growth is a dream for many companies in Kenya. M-PESA continues to spread its
tentacles to every arena of digital money. Indeed it is a mystical phenomenon when it comes to digital
money. Certainly, M-PESA is a revolutionary disruptive innovation that has been a sweet success story in
Kenya. Even more, it is a ‘virus’ that cannot be caged.

21
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