What makes a company succeed? Product, team, market size and regulatory environment are familiar and correct answers.

What makes a succeeding company great? A certain proverb comes to mind: “If you want to go fast, go alone; if you want to go far, go together.” Is this an African proverb? That’s heavily contested, but it sure has value for African companies. 

Market fragmentation is a common complaint on the continent. But as experienced companies like Safaricom demonstrate, one way to work around the problem is to land giant partnerships. More on that in a moment, after this message from our partner.

Going beyond

Last week, Bloomberg reported that Safaricom, Kenya’s biggest telecoms provider, plans to integrate M-Pesa as a payment option on Amazon.

It could make it easier for Amazon customers in Kenya to shop and ship goods using mobile money. But there are two other motives; recovery from 2020 and expansion beyond Africa.

Safaricom’s full year financial results showed a 9.9% year-on-year increase in customers that are active for at least one month; the company now has 31.5 million customers. 

But annual profit declined for the first time in a decade and M-Pesa, which accounts for 33.0% of Safaricom’s revenue, wobbled.

Safaricom’s profit after tax for the 12 months up to March 31, 2021 reduced by 6.8% – from 73.66 billion shillings to 68.67 billion shillings ($642 million).

One month active M-Pesa customers grew 13.6% to 28.31 million but Mpesa revenue declined 2.1% over the same period.

The company resumed charging for transfers in the second half of 2020, causing an upward curve. Total M-Pesa transaction value grew 58.2%. Volume of transactions grew 29.8%. 

Olanrewaju Odunowo/TC Insights

Overall, M-Pesa showed resilience in a tough year, proving itself a mainstay of the financial system in Kenya. Number of M-Pesa agents grew 43.1% to 247,869.

To shore up its future, it is only wise that Safaricom plots more use cases to increase M-Pesa’s volume and value. Better still if these cases involve international transactions that increase the product’s global visibility.

Enter Amazon, the world’s largest online retailer.

African fintechs need partnerships with larger players to achieve whatever global ambitions they have. 

In Nigeria, for example, Flutterwave has a partnership with Worldpay for online card payments and with Alipay. Last December, MFS Africa added Xoom, Paypal’s money remittance service, to its network of international money transfer partners. 

Whether for better customer satisfaction in the short term or as a long-term expansion strategy, cross-border partnership is an ultimate fintech growth hack.

[ Read: How fintech startups can expand their market size through partnerships ] 

If it happens, Amazon will be the second major online retailer partnership Safaricom secures to increase M-Pesa’s usage between Africa and the rest of the world. In 2019, Safaricom entered a deal with Alibaba to allow shoppers to buy goods on AliExpress using M-Pesa. 

A recurring M-Pesa criticism is that it remains an East African mobile money product. It failed in South Africa and isn’t available in Nigeria, thereby missing out on the continent’s other big markets.