Visa, Safaricom partner on new payment intiatives
By Omobayo Azeez
Global financial service company, Visa has connected to Kenya’s telecom Safaricom, operator of the M-Pesa mobile money product.
The arrangement opens to M-Pesa’s own extensive financial services network in East Africa and Visa’s global merchant and card network across 200 countries.
The two companies will also collaborate “on development of products that will support digital payments for M-Pesa customers,” according to a Safaricom release, which also indicated that the partnership is still subject to regulatory approval.
Safaricom’s M-Pesa app is arguably the most recognized fintech product in Africa and has become a global case study in using mobile money to increase financial inclusion.
On a continent that is still home to the largest share of the world’s unbanked population, Kenya has one of the highest mobile-money penetration rates in the world.
According to pundit, this is largely due to the dominance of M-Pesa in the country, which stands as Africa’s sixth largest economy.
Across Kenya’s population of 53 million, M-Pesa has 24.5 million customers and a network of 176,000 agents, while the product’s mobile money market share in the country has hovered above 75 per cent for years.
The details are still vague, but Visa and Safaricom also said they will use the partnership to facilitate online commerce as the two payment providers aim to “offer an expanded set of mobile e-commerce capabilities to merchants and consumers by enabling secure and convenient cashless payment solutions,” according to a Visa release to business a.m.
Visa has been on a VC and partnership spree with African fintech companies over the last year. The company announced collaborations with payment startups Paga and Flutterwave and invested $200 million in Nigerian financial services provider, Interswtich.
In its 2020 Investor Day presentation, Visa named working with the continent’s payments startups, in particular, as part of its strategy to expand on the continent.
As one of the most well-capitalized and profitable companies in Kenya, Safaricom is no startup. But the reach of its M-Pesa network will give Visa an extended presence in Africa.
According to Visa, the partnership will also expand the global financial services offered to Safaricom’s large East African consumer and small business network.