M-Pesa money services are now entirely owned by Safaricom and Vodacom’s joint venture, after a deal was made with Vodaphone, the mother company of Vodacom. The companies, retain a 50/50 split on shares and have acquisitioned all support services, product development, as well as future decisions and strategy.
M-Pesa – ‘M’ standing for Mobile and ‘Pesa’ meaning Money in Swahili – was launched in 2005 by Safaricom and Vodafone, as a mobile money transfer, financing and microfinancing service in Kenya. Their intent was targeting un-banked, prepaid mobile subscribers for a more convenient way to conduct finances.
Vodacom Group CEO, Shameel Joosub, states that this is a great step towards their future financial service goals. The joint venture has allowed Safaricom and Vodacom to push into next generation M-Pesa platforms and applications made for the “smartphone age”. In addition, the venture helps the companies further bridge the financial accessibility gap, and promote financial inclusion, in the communities they operate in.
Safaricom CEO, Michael Joseph expressed his excitement that M-Pesa development, support, and management are now moving back to Kenya, where the mobile financial services journey began 13 years ago. “This new partnership with Vodacom will allow us to consolidate our platform development, synchronize more closely our product roadmaps, and improve our operational capabilities into a single, fully converged Centre of Excellence.”
Today, M-Pesa has 40 million customers from Kenya, Tanzania, Ghana, The Democratic Republic of Congo, Lesotho, Egypt and Mozambique, as well as Afghanistan. The details for the financials of the transaction are unclear, estimated by Safaricom to be around $13 million in the previous year. Though only 25% of M-Pesa customers are smartphone users currently, numbers are increasing by 10% per year. Safaricom and Vodacom are eager to provide their more varied and complex services to those customers.