Safaricom takes next step with M-PESA agressively targeting merchants

Safaricom has launched Lipa na M-PESA, an extension to it’s successful mobile money service M-PESA. With the new service consumers can buy goods and services at Merchants accepting this payment method. Safaricom’s agressive target is to get 100 000 merchants onboard before end of April 2014. Merchants need to apply via a simple registration process, including getting a special SIM (called a Till), at Safaricom authorized dealers, M-PESA agents or Safaricom Retail Shops.

At a purchase the money is tranferred in real-time between the consumer and the merchant account. Transaction values between Ksh 10-70 000 (€0,01-630) is free of charge for the customer. A fee of 1.5% of the value of the transaction will be charged to the merchant for every transaction.

To use the Lipa Na M-PESA service, customers go to the M-PESA Menu, select Payments Services and select Buy Goods, then enter the Till Number that the merchants will display, and follow subsequent prompts to complete the transactions. Both the merchant and the customer will then get confirmation messages from M-PESA.

Merchants jumping on this new service will get access to 17 million registered M-PESA users and I believe this is a very competitative offer for the region. The user experience is still low, the security would not be accepted in the western world and the cost is still very high (for consumers using the standard M-PESA mobile money service)…but it will work in this region.

Read about Lipa na M-Pesa here

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