M-Pesa takes on cross-border approach to financial transactions - CNBC Africa

M-Pesa takes on cross-border approach to financial transactions

East Africa

by Elayne Wangalwa 0

Kenyan and Tanzanian M-Pesa customers will enjoy transacting money between the two countries for the first time. PHOTO: Getty Imgaes

Customers of Kenya’s leading telecommunication firm, Safaricom will now be able to transact money to and from Tanzania.

In a move focused at deepening financial inclusion in the two countries, Safaricom’s 12.8 million active users will be able to send and receive money through Tanzania’s mobile service operator, Vodacom.

“This is a new chapter in the continuing growth story of M-PESA. Enabling transactions between Kenya and Tanzania will make more convenient for individuals to transact across borders and unleash the transformative power of a first of its kind cross-border payment system,” said Safaricom’s CEO Bob Collymore said in a statement.

The partnership by Safaricom and Vodacom is also expected to further boost regional integration between the two countries.

“The partnership will begin the journey for our over 7 million Vodacom subscribers to send money to M-PESA subscribers and vice versa using the service and boost the volume of transactions and trade between the two countries,” said Rene Meza, CEO of [DATA VOD:Vodacom] Tanzania.

This move by Safaricom is seen as a great stride for Kenya’s telecommunication sector which accounts for 30 per cent of the world's 61 million active mobile money users.

According to a report by the United States Agency for International Development (USAID), the global leader in mobile money is Kenya.

Since its launch in 2007, M-Pesa has become the most famous mobile money service in Africa and is said to have exceeded the reach of any other financial service in Kenya. The mobile money platform was then launched a year later by Vodacom in Tanzania.

Safaricom, which is partly owned by the Kenyan government and UK’s Vodafone, recently celebrated its eighth birthday. The mobile money platform has fully-fledged beyond the normal mobile money transfer services to include diaspora remittances and retail payments.

Meanwhile, last year Tanzania Vodacom launched a retail payment service to improve the operations of the business community in the country.