Close to one year ago, we reported on Safaricom’s plan – together with Vodacom – on acquiring all M-Pesa rights from UK company Vodafone. The US $13 Million deal was said to be one that would allow both Vodacom and Safaricom to make significant savings in royalties they pay to Vodafone, allowing them to expand to more markets across Africa.
Well, with the deal now closed, the M-Pesa brand is now fully owned by Safaricom and Vodacom, and going forward product development, support services will be coordinated through the new venture. We can now expect the serious development of M-Pesa across Africa.
M-PESA is the largest payments platform on the African continent, it has 40 million users and processes over a billion transactions every month. M-PESA is operational in Kenya, Tanzania, Lesotho, Democratic Republic of Congo, Ghana, Mozambique and Egypt. Currently around 25% of all M-PESA customers have access to a smartphone – a figure that is growing by 10% every year.
The official announcement says that ‘the disposal of the M-PESA brand, support and product development services to Vodacom and Safaricom is broadly financially neutral for Vodafone Group.’
What the CEOs say on the deal:
Shameel Joosub, Vodacom Group CEO, says “This is a significant milestone for Vodacom as it will accelerate our financial services aspirations in Africa. Our joint venture will allow Vodacom and Safaricom to drive the next generation of the M-PESA platform – an intelligent, cloud-based platform for the smartphone age. It will also help us to promote greater financial inclusion and help bridge the digital divide within the communities in which we operate.”
Michael Joseph, outgoing Safaricom CEO says: “For Safaricom, we’re excited that the management, support and development of the M-PESA platform has now been relocated to Kenya, where the journey to transform the world of mobile payments began 13 years ago. This new partnership with Vodacom will allow us to consolidate our platform development, synchronise more closely our product roadmaps, and improve our operational capabilities into a single, fully converged Centre of Excellence.”
Nick Read, Vodafone Group’s CEO, said: “M-PESA is hugely successful and enables millions of unbanked people in Africa to transfer money, pay bills and trade. It benefits communities and helps create a multitude of small and micro-business ventures. However, with the rapid increase in smartphone penetration, the evolution into financial services and the potential for geographical expansion, we believe the next step in M-PESA’s African growth will be more effectively overseen by Vodacom and Safaricom.”