NAIROBI, Kenya, Oct 14 – Kenya’s leading mobile telephony provider Safaricom on Tuesday launched an International Money Transfer (IMT) service on M-Pesa.
This will allow subscribers to send and receive money from the United Kingdom straight to their M-Pesa account. The launch followed three months of rigorous testing and pilot project with selected agents in the UK.
Safaricom Chief Executive Officer Michael Joseph said the new service is aimed at capturing diaspora remittance.
“We wish to invite Kenyans living in the UK to take advantage of this service, which presents a real innovation on our M-Pesa menu,” he said.
Central Bank of Kenya (CBK) Governor Prof Njuguna Ndungu lauded the move saying it was a great way of mainstreaming informal remittance channels. He said CBK would be closely monitoring the cost of remitting funds with the aim of streamlining them, to turn them into formal channels.
“Many of these informal channels deal with small amounts of money but are not as secure,” he said.
He said remittance figures stood at close to Sh3.7 billion in Kenya.
“That figure is not chicken feed by any standards, but (we want to monitor) what that money is financing to see whether it is being used appropriately,” the CBK Governor said.
To cushion customers from currency fluctuations, Mr Joseph revealed conversion would be done directly from the point of sending the money.
“The sender will be advised by the agent of the prevailing exchange rate and equivalent amount the customer in Kenya will receive,” he explained.
Currently, the maximum amount that can be sent internationally per transaction through M-Pesa is £250 (Sh30,000) while the total allowable per month from a single sender in the UK is £1,000.
Normal transaction limits and charges apply to the M-Pesa account in Kenya, including a maximum balance of Sh50,000.
Following the launch Mr Joseph said Safaricom would be expanding the IMT services to allow remittances to Kenya from other relevant markets.
He revealed Uganda was one of the markets he was keenly looking to tap into.
“We definitely want to move to other countries with significant concentrations of Kenyans. Obviously, Uganda is one of those markets, so is Dubai, Tanzania, Rwanda and the United States,” he said.
He was however categorical this was subject to regulatory approvals from the said countries.
“All these countries have strict laws and regulations, which we have to ensure we abide to before we can venture there,” he explained.
According to the CEO, M-Pesa boasts of close to 7.5 million active users, serviced by an agent network of over 12,000 agents. Since its launch in 2007, M-Pesa has recorded close to Sh230 billion worth of person-to-person transactions.
A total of 19 outlets were carefully selected to cover areas with relatively high number of Kenyans, including Reading, London, Luton, Wembley & Glasgow, comprising of a variety of shops including forex agents, news agents and grocery shops commonly visited by Kenyans.
The launch of the IMT comes less than a month after Safaricom’s main rival Zain launched services that allow customers send and receive money from any where in the world.