Safaricom and Mastercard Partner to Expand Remittances and Payment Acceptance to over 636,000 Merchants in Kenya

Rhea-AI Summary

Safaricom and Mastercard have partnered to boost payment acceptance and cross-border remittance services in Kenya, benefiting over 636,000 M-PESA merchants. This collaboration aims to leverage M-PESA's extensive merchant network and Mastercard's global payment infrastructure to provide seamless, secure, and scalable payment solutions. The partnership will enhance digital payments across Kenya by embedding Mastercard's omnichannel acceptance solutions into M-PESA's merchant space. Additionally, it will streamline cross-border transactions, making them faster and more reliable. Kenya's payment acceptance market is growing, with mobile wallet payments driven by M-PESA showing a 12.7% CAGR between 2020 and 2024. The first initiatives from this partnership are expected to roll out in the coming months, supporting Safaricom's journey towards securing its acquiring license.

Positive

• Partnership expands payment acceptance to over 636,000 M-PESA merchants in Kenya
• Enhances cross-border remittance services, making transactions faster and more reliable
• Leverages Mastercard's global payment infrastructure to provide scalable solutions
• Aligns with Kenya's growing payment acceptance market, showing 12.7% CAGR for mobile wallet payments (2020-2024)
• Supports Safaricom's journey towards securing its acquiring license

Negative

• None.

Insights

Financial Analyst

This partnership between Safaricom and Mastercard is a significant development for Kenya's digital payment ecosystem. With M-PESA's 12.7% CAGR in mobile wallet payments from 2020 to 2024, this collaboration taps into a rapidly growing market. The expansion to over 636,000 merchants represents a substantial increase in the addressable market for digital payments.

From an investor's perspective, this move could potentially boost Safaricom's revenue streams through increased transaction volumes and fees. The integration of Mastercard's global infrastructure may also open up new revenue opportunities in cross-border transactions. However, investors should monitor the implementation costs and timeline for realizing these benefits. The partnership's success will largely depend on merchant adoption rates and consumer acceptance of the new payment solutions.

Market Research Analyst

This collaboration is strategically positioned to capitalize on Kenya's evolving digital payment landscape. The partnership addresses two key growth areas: merchant payments and cross-border remittances. By combining Safaricom's local market dominance through M-PESA with Mastercard's global reach, they're creating a powerful synergy.

The potential market impact is substantial, considering Kenya's position as a regional economic hub. If successful, this model could be replicated in other African markets, providing a blueprint for digital payment expansion across the continent. Investors should watch for metrics such as transaction volume growth, merchant onboarding rates and any changes in market share for both mobile payments and remittances in the coming quarters to gauge the partnership's effectiveness.

Tech Expert

The technical aspects of this partnership are important for its success. Integrating Mastercard's omnichannel acceptance solutions with M-PESA's existing infrastructure presents both opportunities and challenges. The key will be ensuring seamless interoperability between the two systems while maintaining robust security measures.

Safaricom's journey towards securing an acquiring license is a significant technical and regulatory milestone. This move could potentially allow Safaricom to process card payments directly, reducing dependency on third-party acquirers and potentially improving margins. The implementation of "cutting-edge digital payment solutions" mentioned in the article will likely involve advanced technologies such as tokenization, contactless payments and possibly even blockchain for cross-border transactions. Investors should monitor the rollout for any technical hiccups that could impact adoption rates or transaction security.

NAIROBI, Kenya--(BUSINESS WIRE)-- Safaricom and Mastercard have signed a partnership to accelerate the adoption of payment acceptance and cross-border remittance services in Kenya. This collaboration is set to benefit over 636,000 merchants using M-PESA, Safaricom’s leading mobile money service.

(L-R Back): Shehryar Ali, SVP and Country Manager for East Africa & Indian Ocean Islands at Mastercard; Lenin Oyuga, Head of Telco Commercial and Partnerships, Middle East and Africa (MEA) at Mastercard; Aliya Khanbhai, Tribe Lead for Next Financial Services Wealth and Insurance at Safaricom Plc; and Victor Odada, Head of M-Pesa Payments at Safaricom Plc. (L-R Front): Amnah Ajmal, Executive Vice President, Market Development, EEMEA at Mastercard and Esther Waititu, Chief Financial Services Officer at Safaricom Plc. The executives signed an agreement between Mastercard and Safaricom Plc that will enhance payment acceptance and cross-border remittance services to over 636,000 M-PESA merchants in Kenya. (Photo: AETOSWire).

Kenya’s payment acceptance market continues to grow, with mobile wallet payments driven by M-PESA showing a 12.7% CAGR between 2020 and 2024. Leveraging M-PESA’s extensive merchant network and Mastercard’s global payment infrastructure, this partnership will make more seamless, secure, and scalable payment solutions available to merchants, enabling them to serve customers across global markets. The partnership will also boost remittance services, streamlining cross-border transactions efficiently.

“We are proud to partner with Safaricom to build an inclusive digital economy that works for everyone, everywhere. We will enable the merchants to grow and contribute to the Kenyan economy,” said Amnah Ajmal, Executive Vice President, EEMEA, Mastercard.

By embedding Mastercard’s omnichannel acceptance solutions across M-PESA’s merchant space, the partnership is scaling digital payments across Kenya. Furthermore, by integrating Mastercard’s infrastructure, Safaricom will enhance cross-border money transfers, providing faster, more reliable transfers, while advancing its ability to support merchants in accepting digital payments.

“This collaboration with Mastercard unlocks new opportunities for M-PESA merchants, aligning with our mission to deliver innovative, customer-centric products. By combining our expertise with Mastercard’s global acceptance network, we are enabling businesses to provide more efficient and frictionless payment solutions to their customers, both in Kenya and beyond,” said Esther Waititu, Chief Financial Services Officer, Safaricom Plc.

Safaricom and Mastercard are committed to foster innovation and financial inclusion within Kenya’s evolving digital landscape. The first initiatives are expected to roll out in the coming months, advancing Safaricom’s journey toward securing its acquiring license and providing merchants with cutting-edge digital payment solutions.

About Mastercard (NYSE: MA) www.mastercard.com

Mastercard is a global technology company in the payments industry. Our mission is to connect and power an inclusive, digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses realize their greatest potential. With connections across more than 210 countries and territories, we are building a sustainable world that unlocks priceless possibilities for all.

About Safaricom

Safaricom is the leading telecommunication company in East Africa. Our purpose is to transform lives by connecting people to people, people to opportunities, and people to information. We keep over 41 million customers connected and play a critical role in society, supporting over one million jobs both directly and indirectly. Our total economic value was estimated at KES 362 billion ($3.2 billion) for the 12 months through March 2021.

Listed on the Nairobi Securities Exchange and with annual revenues of close to KES 264 billion ($2.9 billion) as at March 2021. Safaricom provides connectivity through a wide range of technology, 2G, 3G, 4G and 5G in aggregate, covering over 99% of Kenya’s population.

We run the world’s largest mobile payment system and Africa’s largest Fintech, M-PESA, the world’s first mobile money transfer system. By empowering over 28 million customers to transact, save or borrow money through their mobile phones, M-PESA has driven financial inclusion in Kenya to more than 82% of the adult population from a low of 25% and generated over KES 82.65 billion ($826 million) in revenue as at FY21.

Our subsidiary, Safaricom Telecommunications Ethiopia, plans to deploy a world-class network and services by mid-2022 to contribute to Ethiopia’s digital transformation.

Safaricom is an equal opportunity employer, actively recruiting staff from different backgrounds reflecting the communities that we serve. We are committed to equal gender representation at all levels. Our target is to achieve 50:50 senior management gender parity by 2025.

As part of our ongoing commitment to the Sustainable Development Goals (SDGs), we continue to work towards improving energy and resource efficiency in our network and facilities to reduce carbon emissions and fuel consumption. We remain committed to becoming a Net Zero carbon-emitting company by 2050.

For more details, please visit www.safaricom.co.ke

For news, please visit: https://www.safaricom.co.ke/about/media-center/publications/press-release

For media-ready photos, visit: https://www.flickr.com/photos/safaricom_pr

*Source: AETOSWire

View source version on businesswire.com: https://www.businesswire.com/news/home/20240919122413/en/

Kanyi L. Mwangi, Communications Director

Kanyi.Mwangi@mastercard.com

Safaricom PR & Corporate Communications

Phone: +254722005211

PRComms@Safaricom.co.ke

Source: Mastercard

FAQ

What is the purpose of the Safaricom and Mastercard partnership in Kenya?

The partnership aims to accelerate the adoption of payment acceptance and cross-border remittance services in Kenya, benefiting over 636,000 M-PESA merchants by providing seamless, secure, and scalable payment solutions.

How will the Safaricom-Mastercard partnership affect M-PESA merchants?

The partnership will enable M-PESA merchants to access Mastercard's global payment infrastructure, allowing them to serve customers across global markets and accept digital payments more efficiently.

What is the growth rate of mobile wallet payments driven by M-PESA in Kenya?

Mobile wallet payments driven by M-PESA in Kenya have shown a 12.7% Compound Annual Growth Rate (CAGR) between 2020 and 2024.

How will the Safaricom-Mastercard partnership improve cross-border remittances?

The partnership will integrate Mastercard's infrastructure to enhance cross-border money transfers, providing faster and more reliable transfers for Safaricom customers.

When are the first initiatives from the Safaricom-Mastercard (MA) partnership expected to roll out?

The first initiatives from the Safaricom-Mastercard partnership are expected to roll out in the coming months, advancing Safaricom's journey toward securing its acquiring license.