Safaricom, a Kenyan mobile network provider; Vodafone, a British telecommunications company; and the Kenya-based Commercial Bank of Africa (CBA) reportedly have partnered to launch a new service called M-Shwari for Safaricom customers. M-Shwari will give users access to an interest-bearing savings account provided by CBA and enable them to apply for microloans, also from CBA, directly from their mobile phones. Customers can sign up without visiting a bank by using the menu on their phones that is used for M-Pesa, a Kenyan mobile banking service. CBA will determine customers’ eligibility based on their M-Pesa transactions and savings history, and the money is sent directly to their M-Pesa account.
Vodafone provided the design and functionality for M-Shwari. According to a statement attributed to Michael Joseph, Director for M-Pesa within Vodafone Group, “all Kenyans can now save, even the smallest amounts and at their own pace. M-Shwari creates a safe environment for customers to borrow small amounts and links the amounts of credit available to the ability to save.” The amount of interest on the savings accounts as well as the minimum transaction size and required balance have not been released.
As of 2011, M-Pesa serves approximately 14 million clients through 28,000 agent outlets, intermediating 2 million transactions per day in Kenya. As of September 30, 2012, Vodafone reported approximately 407 million customers.
By Charlotte Newman, Research Associate
About M-Pesa
M-Pesa is a Kenyan mobile money service. The “M” stands for “mobile,” and “pesa” means “cash” in Swahili. Launched in 2007 by Safaricom Limited, a Kenya-based cellphone service provider, M-Pesa was developed by Vodafone Group Private Limited Corporation, a British multinational mobile network operator. As of 2011, M-Pesa serves approximately 14 million clients through 28,000 agent outlets, intermediates two million transactions per day.
Sources and Additional Resources:
Vodaphone Press Release: “Safaricom Launches M-Shwari – Offering Interest and Loans – On M-Pesa,” http://www.vodafone.com/content/index/media/group_press_releases/2012/m-shwari.html
MicroCapital.org story, November 2, 2012, “MICROCAPITAL BRIEF: Vodafone’s M-Pesa Mobile Money Service to Expand International Options with HomeSend Partnership,” https://www.microcapital.org/microcapital-brief-vodafones-m-pesa-mobile-money-service-to-expand-international-options-with-homesend-partnership/
MicroCapital.org story, October 25, 2012, “MICROCAPITAL BRIEF: Kenya to Levy 10% Tax on Mobile Money Transactions,” https://www.microcapital.org/microcapital-brief-kenya-to-levy-10-tax-on-mobile-money-transactions/
MicroCapital Universe Profile: M-Pesa http://microcapital.org/microfinanceuniverse/tiki-index.php?page=M-Pesa
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