NAIROBI, Kenya, Jun 9 – Kenyans will from Friday transfer money from one bank to another for free in the next two months following the launch of PesaLink.
PesaLink is an interbank money payment system where customers can transfer from Sh10 to Sh1 million from a bank to another on a real time basis.
The transfers can be done through mobile phones, agents, branches, ATMs and Internet banking.
The payment switch is owned by the Kenya Bankers Association (KBA) and has over 26 banks signed to the platform out of the 41 banks in Kenya.
Kenya Bankers Association Chief Executive Habil Olaka says the free window is aimed at luring more customers and banks to the platform.
“We have about 3.5 million customers who are using our platform. This is about 90 per cent of the banked in Kenya since major banks are on the platform, we are expecting all banks to be integrated soon, different systems, as well as decision making since some banks are not headquartered here, has attributed to the slow adoption of banks,” Olaka said.
Already, transactions worth Sh2.5 billion have been made on the platform in four months of its pilot stage.
However, this is figures are net settlement figures (the resolution of all of a bank’s transactions at the end of the day) and not the gross settlement figures which is much more,” Olaka explained.
Going forward in the second stage, the platform will be enabled to transfer multiple currencies, as well as bill payments on utilities like paying for water, electricity, among others.
After the free two months, charges will vary between Sh20 and Sh200 from sending as low as Sh10 to Sh1 million.
“We shall reach out to the unbanked through changing from cash to code, we shall facilitate B2P (Business to People) transactions and even ensure into partnerships with the government and other financial institutions apart from banks,” he added.
Payments from Sh1 million ($10,000) and above are effected through the electronic real-time bank transfer system.
This innovation is viewed as a game-changer in the money transfer business, and a competitor to Mobile Money Transfer platforms especially Safaricom’s M-PESA which is the market leader.
In October to December 2016, the volume of mobile money transactions was registered at 456.6 million with Sh1.1 trillion transferred during the period.
Mobile commerce recorded a total of Sh262.6 million transactions with Sh586.4 billion used to pay for goods and services.
The person-to-person transfers amounted to Sh515.9 billion Kenya during the period.
M-PESA transactions in the period under review hit Sh892 billion with about 260 million number of transactions.
Equitel Mobile money transactions value was at Sh251 billion while Airtel money was Sh6 billion.