M-Pesa users can now send money to Uganda

Safaricom CEO Bob Collymore makes his keynote address during 2015-2016 Financial year results at their head office Nairobi 05/11/15 PHOTO BY MOSES OMUSULA

M-Pesa users in Kenya can now send money to Uganda’s MTN mobile money users in a move likely to stamp Safaricom’s authority in mobile money transfer services in the region.

This follows a partnership deal between Safaricom and MTN, the leading mobile operator in Uganda. It becomes the third deal M-Pesa is signing in the region following similar partnerships with Vodacom of Tanzania and MTN of Rwanda earlier in the year.

Safaricom’s Director of Financial Services Betty Mwangi said the deal resonates well with the economic initiatives of the East African Community. Through this, the firm expects to deepen cross-border mobile money services.

“This is yet another affirmation of our intention to make it possible for our individual and business customers to enjoy convenient, affordable and reliable mobile money services across the borders,” said Ms Mwangi.

The deal will allow for seamless sending and receiving of money between the two countries whose trade partnership has been growing over the years. Currently, Uganda is Kenya’s largest trading partner in the region.

M-Pesa boasts of over 22 million customers while Uganda’s MTN has at least 5 million users. According to the latest data from Communications authority of Kenya (CA) money transacted through mobile phones in Kenya hit Sh1.3 trillion in the first half of 2015 up from Sh1.1 trillion at the same period last year.

MTN Uganda Mobile Financial Services General Manager Phrase Lubega said he was delighted about the agreement with M-Pesa, whose transactions are estimated at 250 per second.

“We are excited to offer affordable remittance services from M-Pesa to MTN Mobile Money users in Uganda. Our subscribers will cash out at any of our 55,000 agents across the country,” said Lubega.

Infrastructure between the two networks has been enabled by MFS Africa, which develops and distributes mobile financial solutions to markets across Africa. “We are confident the cashless revolution that started in Kenya almost a decade ago, will now unlock not only intra-African remittances but also serve as a catalyst for trade and economic growth in the region,” said MFS Africa’s CEO Dare Okoudjou.

To access the service, customers will be required to dial *840# from their mobile phones and follow the prompts. For M-Pesa users in Kenya, the money will be sent in Kenya shillings, and received in Ugandan shillings, based on the prevailing exchange rate as at midnight.

The deal comes a year after Central Bank of Kenya awarded Safaricom a cash remittance operating licence, enabling it to transfer money out of the country. This enabled it to compete with banks and global cash remittance firms such as Moneygram and Western Union. Since its launch in March 2007, M-Pesa has grown into the most reliable cash cow for the NSE-listed telecom, accounting for Sh19.4 billion that Safaricom generated from M-Pesa in the six months to September 2015.