Last week, Kenya mobile network operator Safaricom announced
it’d reduce M-Pesa’s transaction fees, taking effect from the 1st of January, 2021.
: For years, M-Pesa’s transaction fees have been thought
to be quite high despite its ubiquitousness in Kenya. And for customers, this has always been a huge concern even though they have all had little choice but to stick with the service. Earlier this year, due to the pandemic and economic circumstances the Central Bank of Kenya imposed zero fees on M-Pesa transactions to ease financial burdens. This imposition meant a reduction in the revenue but also saw M-Pesa’s transaction volume grow by 32.9%.
What changes should we expect?
M-Pesa’s tariff is to be reduced by up to 45 percent, and this will affect more than
90 percent of all customer’s transactions. For instance, it will now cost KES 6 ($0.055) to send between KES 101 (($0.93) and KES 500($4.6), down from KES 11($0.1).
In addition to the reduced fees, all transactions of KES 10 ($0.92) and below will remain free. Also, all M-PESA customers will continue to enjoy free transactions between M-PESA and bank accounts.
: It Took A Pandemic For Safaricom To Finally Heed & Cut High M-Pesa Fees
Something else to consider:
In TechCabal's last edition of Building the Future with Nigerian entrepreneur
Iyin Aboyeji, he addressed the claim that in countries like Kenya, where Mobile Network Operators and Mobile money Operators are big, local fintechs remain small. Aboyeji would prefer that M-Pesa opens up its APIs to allow other players come into the space, rather than gatekeeping the ecosystem.
Listen to his short response here.