With mobile phones widespread among Kenyans, getting access to banking services is within reach. This has allowed mobile phone users to store, send and receive money using their mobile phone.
In Kenya, the safety and ease of making payments electronically make mobile money a popular alternative to bank accounts.
The mobile money services can be used on both smartphones and basic feature phones.
According to the quarterly Sector Statistics Report by the Communications Authority of Kenya, Safaricom’s M-Pesa share of mobile money subscriptions was 98.8%, whereas Airtel Money operated by Airtel Kenya and T-Kash by Telkom recorded insignificant market shares of 1.1% and 0.05% respectively.
Safaricom is still extremely dominant when it comes to Kenya’s mobile money market, with almost 99% market share.
Data from the Central Bank of Kenya shows that M-Pesa has grown its share of the value of mobile money transactions in the last three years to hit Sh2.206 trillion out of the total of Sh2.208 trillion worth of transactions in 2021.
Over the years, the growth in M-Pesa customer usage was driven by the launch of various innovations of financial services such as M-Shwari, KCB M-Pesa and Fuliza.
The growth has eaten into the market of Airtel Money and Telkom’s T-Kash in the period with their shares dropping to 0.2 percent and 0.1 percent respectively.
Telkom’s T-Kash, recorded the lowest market share.
To try and increase its market share, Telkom Kenya is in the process of integrating its mobile money service, T-Kash’s systems, with local commercial banks to allow customers to send and withdraw money from their accounts.
According to Mr. Mugo Kibati, Telkom Kenya chief executive officer. The firm is working with Integrated Payments Services Limited, a secure electronic payment company owned by Kenya Bankers Association (KBA) to link T-Kash and bank accounts.
Integrated Payments Services Limited (IPSL) systems enable direct transfer of funds from one account to another using a central switch.
It also supports person-to-person transactions anchored on a central switch linking all local banks and providing interoperability of retail payments.
The whole idea is to enable T-Kash customers’ bank accounts connected directly to their mobile money wallet. T-Kash is already allowing its customers to send and withdraw money with KCB and standard chartered banks.
Telkom management is working very hard to see a lot more of the banks coming on board; hopefully over the next year.
Safaricom spread its roots both local and global by partnering with established technological financial firms like PayPal, AliExpress and Western Union to enable its customers to send or receive money, and also make payments across the world.
In recent years, Mobile money has grown to be a lucrative revenue stream for telcos as more customers use mobile money to send or receive cash, take short-term credit or pay for goods and services.