Mobile money transactions hit 7 billion shillings daily mark

Mobile money transactions hit the 7 billion mark per day in October 2015. These transactions have been majorly enabled by Mpesa, Safaricom's mobile money transfer brand.. This signals a bright future for Africa's Mobile payments industry. Stakeholders are bracing for a massive growth going into 2015 mainly because of the acceptance by more sectors of the economy. Safaricom who owns nearly 80% of the market share attributes the spike in transactions and mobile money payments to an increase in agents who are cashing in to reap some profits.
The banking sector is increasingly embracing mobile money and customers can now pay straight from their accounts through MPESA. Paying of utility bills has never been easier. More merchants have also embraced this new technology. Safaricom says that a record 32 thousand merchants are now connected and receiving payments via mobile money. Mobile transactions rose to 210 billion shillings in October up from 206 billion shillings the previous month.
The uptake of mobile money transactions and payments has seen a drop in card payments. Cards payments stood at sh 104 billion from January till October which is a drop from 129 billion shillings recorded last year same period. Visa MasterCard has gone full throttle in marketing their cashless payment mode on print and electronic media. Other players deep in the fight for market share for the payments business are Jambopay ,Equity Bank with their flagship payments brand Equitel, Mobicash, Tangaza and the list goes on and on. Africans are embracing the mobile payments phenomenon at a good rate even though the large percentage are still stuck to cash. Converting the hard cash users to mobile payments ambassadors will be the win for the stake holders in this industry.

How Mobile Payments are Creating Convenience in Consumer and merchants Transactions

Since the advent of the mobile  phone a lot has happened in terms of making life easy for consumers. Initially the mobile phone was used only for making and receiving calls. At the turn of the century however the mobile phone has revolutionized a lot and made life easy for millions of consumers. Mobile payments and merchant accounts settlement is the craze now. With  a big percentage of consumers owning mobile phones the divide between merchants and consumers has been bridged. Mobile is the easiest and most reliable form of payment to any connected merchant.

Safaricom, Kenya’s top mobile network operator has recently g

one full throttle to drive mobile payments usage. The Mobile operator is giving away eight houses to its subscribers. Mobile users who pay for their bills using the mobile money platform, MPESA stand a chance to win good prizes.

Safaricom powered 22.5 Million dollars worth of transactions. With 32,000 merchants doing an average of 10 dollars worth of transactions on its ecosystem and millions of mobile payments, Safaricom is unarguably the biggest force to reckon with in the region. With 19.5 million users Mpesa offers the leading form of cashless payments second only to cards payments in Africa.

Solo payments a company that offers kiosks for merchants to receive their payments also has an aggressive campaign to drive merchants payments solutions in Africa. Although it is not a mobile form of payment solution it has an ambitious plan of acquiring multiple merchants onto its ecosystem. Currently one can pay for one of the major pay tv and purchase airtime in addition to buying electricity tokens. If solo get intergrated with Safaricom’s MPESA then they will have exposed themselves to 19.5 million mobile money users and that will drive usage for them. However mobile still remains the most potent form of payment since mobile is closest to users than anything else

WHICH WAY FOR THE ELUSIVE MOBILE CASHLESS PAYMENTS

A cashless mobile fare payment for commuter vehicles is something that has continued to elude the stakeholders for a long time in Kenya. Every time the system is set to be launched something comes up that hinders the payments process. Recently Kenya’s own president launched a payments card dubbed 1963. Several Commuters Sacco’s just a tip of Kenya’s commuter industry had put pen to paper endorsing the cashless payments system. Commuters were set to start using the system to ease the problem of having to carry hard cash. The government together with Kenya’s no. 1 Mobile Network Operator Safaricom Ltd was set to gain millions in the deal.

Previously, a few months ago Equity bank had launched their card dubbed Bebapay powered by the Google wallet. Equity bank is Kenya’s biggest bank by customer base having a total of eight million customers. Recently Equity bank has been embroiled in a supremacy battle with Kenya’s top MNO Safaricom when Equity acquired an MVNO license from the communication Authority of Kenya. With the thin sim technology equity aims to offer mobile money transfer to its eight million customers. Of course Safaricom was not taki

ng this lying down. Already with seventeen million active mobile money users through the giant MPESA service Equity poses a threat to Safaricom. It is not a wonder then that Safaricom would launch its 1963 card just a few months after Equity bank’s Google Bebapay.

Another of Kenya’s top banks KCB is not being left behind. They have launched their own cashless payments cards dubbed PepeaCard. Apart from cashless mobile payments KCB’s Pepea card also offers other services like shopping, withdrawing cash and redeeming loyalty points.

With all these, what is causing a snag in cashless payments? For one most of the commuter operators are not ready. The drivers and their assistants insist on hard cash payments until a later date. They claim that the digital cashless payments system should be implemented gradually. Some commuters who are ready should start paying cashless using the cards while those not ready continue using hard cash.

The NTSA National Transport and Safety Authority should hold intensive campaigns of educating the stakeholders before setting the ground rules. Right now the NTSA say that failure to adhere to the new payments system will attract a fine of a hundred thousand shillings (One thousand dollars) or one year jail term

After all is said and done Cashless mobile payments is something that we cannot ignore. It will be like the proverbial ostrich burying head in sand. The rest of the world has embraced mobile payments and Kenya being a pioneer in mobile technology through MPESA should be in the front row in going cashless. Last year alone a total of two trillion shillings was transacted through MPESA.

Already MPESA is powering millions of payments through Lipa Na Mpesa paybill service daily. The stage is set for digital mobile payments……… Lets go digital, Lets go Mobile.

Types of mobile payments

We have discussed how mobile payments has improved the lives of many consumers. Mobile is convenient, fast, secure and we must all agree that at this age mobile is every person's best friend. Research shows that the average person looks at his phone 110 times a day. What does this tell us about payment services and the mobile phone? With a zillion merchants out there who are offer goods and services, the mobile device is the easiest and most convenient tool for making the payments. 

With millions of consumers owning a mobile device, it becomes easy for products that add value to them to be availed. Emerging mobile payments trends cannot be ignored. In the developed world especially the mobile payments technology has made very big strides. research firm Gartner estimates that mobile payments will top $720B by 2017, up from $235B last year.

Mobile app developers are developing applications that will push consumers to change their payments methods and embrace the mobile way.

Imagine going into your favorite coffee shop and after that cup of coffee instead of reaching for your leather wallet you reach for your mobile wallet. Now replicate that to all the merchants like supermarkets, drug stores,schools and hospitals. You have an easy way of making payments straight 
from your mobile gadget.

Africa is rising and mobile payments technologies are advancing. One such payments option has been given to the Nairobi city council where city dwellers can pay for goods and services straight from the comfort of their rooms. They can pay using a mobile application for services such as parking, licenses and land rates. Also pay TV customers can renew subscription straight from their Living rooms.

Africa awaits with bated breaths for mobile payments to be enabled to more and more merchants offering services and goods. Recently Safaricom which is the largest Mobile operator with 20 million subscribers and 16 million mobile money subscribers hit the 3.1 Million mark smart phone users.This is good news for the mobile payments industry. This means that more and more mobile application to enable payments can be developed. What is likely to happen is a rush for a share of the pie that is waiting to be partaken. These are indeed great days to be living in Africa. Africa is rising, but more so in terms of mobile payments and technology.

Why Mobile Payments is the future

Since time immemorial people have always traded and paid for goods. It began with burter trading in the olden days. Then it came to payments by cowrie shells and precious stones. The longest mode of payments has been so far Cash. Different countries have different currencies for instance America with the dollar, British pound and so forth. Even though cash has been the mode of payment that we all in this generation have come to accept another payment method is fast coming into play. This is the mobile or cellphone payment option. This method is fast catching up. 

Consumers of goods and products can make payments to merchants straights from their mobile phones. The mobile phone has become a very easy and convenient method to make payments since majority of people have a phone. 

In Africa and specifically in Kenya one Mobile Network Operator, Safaricom is causing waves with its product Mpesa. Since its inception to the Kenyan market in 2007, the product which first started as a mobile money transfer service has touched the lives of millions. Now at 16million users the mobile money product has evolved to mobile payments to merchants. Millions of transactions totaling to billions of shilllings happen everyday. This makes mobile payments easy to merchants. The merchants are providers of pay Tv, utility providers like water and power. The list is endless as mobile payments can also be made to banks in terms of deposits.

This makes mobile to be the next frontier in terms of payments to merchants and transactions that involve moving money from one point to another.

 In the next article, we will delve more on the advent of smartphones and its direct contribution to mobile payments.

Equity War With Safaricom Takes Atwist As Parliament Rejects Thin Sim Card

Just two days after the Communication Authority of Kenya gave Equity bank a licence
to operate a mobile money business through its thin Sim card Mobile Virtual Network Operation
Parliament has shot it down. The two, Safaricom Ltd and Equity have been fighting neck to neck
over market share for mobile money transfer in Kenya. Currently Safaricom Ltd with an estimated 12 Million
subscriber base on its flagship product MPESA contrls the lion share of mobile money transfer in Kenya.
Equity bank on its part is hoping to bring on board its 8 million subscribers and claim a share in the lucrative
mobile money transfer business. Speaking to the press separately both Safaricom CEO Bob collymore and 
Equity Bank's CEO James Mwangi defended their positions on the whole issue of bringing on board a new
player in the Mobile money transfer business. Collymore says that by introducing a new sim card(Equity's)
customer privacy will be compromised since one has to pass through the other when transacting. On
his part Equity Bank's CEO James Mwangi disputes this saying that both Safaricom's Sim card and The new Equity Bank Sim card cannot be on at the same time and hence no need to worry.
It will be interesting to see how things unfold as the drama continues to unfold. What is clear though is that
customers will be relieved of the huge costs in Mobile money  transfer once a new player comes on board.
However the privacy of mobile users is parramount in terms of password and Mobile banking transactions already being done through the Safaricom platform.