M-Pesa CEO on the future of mobile money, why he’s excited by the rise of fintechs in Africa
Digital technology experts are now accusing the Central Bank of Kenya of choking the innovation pipeline through overregulation. Players say the move is locking out many investors and persons willing to do business within the country. Is this really the case? Alex Owiti, Managing Director at Alexander PR joins CNBC Africa for more.
Mon, 31 Oct 2022 10:28:35 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- M-Pesa's success stories include Fuliza, an overdraft product, and an international money transfer platform that has reduced remittance costs in line with SDG goals.
- The company is focused on reducing transaction costs, increasing accessibility, and expanding services through the Impessa Super App.
- Expansion into new markets, such as Ethiopia, presents opportunities for growth, while regulatory concerns are being addressed through operational adaptability.
M-Pesa, the leading mobile money platform in Africa, has reached significant milestones in account-to-account transactions, with a whopping 72% of the total transaction value in the country now coming from this mode. With over 50 million users across the continent, including 30 million in Kenya alone, M-Pesa continues to innovate and provide solutions to real-world problems. In a recent interview with CNBC Africa, the CEO of M-Pesa Africa shared insights into the company's success and future prospects. One of the key products highlighted was Fuliza, an overdraft product that has proven both successful and profitable. Fuliza was designed to address the issue of failed transactions due to insufficient funds, providing working capital for a few days at a small fee. By addressing this need, M-Pesa was able to generate significant revenue. Another success story for M-Pesa is its international money transfer platform, which has facilitated the movement of billions of dollars into African markets while reducing the cost of remittances to meet SDG goals of 3% or lower. The CEO emphasized the importance of understanding the problem at hand and then leveraging transaction volume and velocity to drive revenue. M-Pesa has also been focused on reducing transaction costs to make its solutions more accessible and scalable. By offering free transactions for certain services and continuously revising its pricing structure, M-Pesa aims to serve more customers and drive financial inclusion. The company recently launched the Impessa Super App, allowing businesses to leverage the platform and create a marketplace for additional revenue streams. Looking ahead, M-Pesa's expansion into new markets, such as Ethiopia, presents exciting opportunities for growth. The CEO highlighted Ethiopia's potential as a key market with a large population and emphasized the need to tailor products and services to local needs while leveraging existing technology. Addressing regulatory concerns about potential business separation within Safaricom, the CEO noted that operational structures can adapt to regulatory requirements without fundamentally changing business operations. Finally, discussing the rise of fintech companies in Africa, the CEO emphasized collaboration and partnership as key strategies for navigating competition. By opening up the OpenAPI platform and welcoming fintech developers to build on the M-Pesa ecosystem, the company aims to foster innovation and provide customers with a diverse range of services. The CEO sees fintechs as a catalyst for M-Pesa's growth, leveraging the company's technology infrastructure to reach more users and drive innovation in the mobile money space.
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