CBK to force Safaricom’s Lipa na MPESA service accept payments from other sources

Safaricom’s Lipa na MPESA service is probably the most used payment solution here in Kenya, the service is so common nowadays that it’ll be almost impossible to get a business entity that doesn’t have it as a payment option. And while it does make things a little simpler in the world of mobile payment options, the service has sort of created a monopoly for Safaricom in that you can’t directly use any other source to make payments without first having to transfer the cash to an MPESA wallet.

According to the latest move by Kenya’s financial regulator – the Central Bank of Kenya you’ll soon be able to make Lipa na MPESA payments from other sources without necessarily having to go through MPESA wallet. What this means is, instead of moving cash from your bank account to MPESA wallet to make a PayBill or Buy Goods transaction, you’ll soon be able to directly make these payments directly from your bank account. The Central Bank of Kenya intents to unveil a national payment system that will allow seamless cash transfers through merchants regardless of where the money is coming from at least by 2024.

In a nutshell, the move basically means, you’ll be able to make payments from the likes of Airtel Money and T-Kash through Safaricom owned Pay Bill numbers. Safaricom has for years dominated the mobile payment market, making most subscribers depended on it that proved to have devastating implications on the competition. While other service providers offer competitive services such as data and call rates, Kenyans have mostly been forced to have Safaricom’s line to be able to access its vast mobile payments service, a practice that has negatively impacted the competition.

And while other service providers such as Airtel have their own payment solutions such as Lipa na Airtel Money, they are not as widely available compared to Lipa na MPESA. According to the financial regulator, mobile payments solutions have been affected by lack of interconnection that would have otherwise enabled merchants to accept payments from any sources.

The interoperability — the ability of different IT systems to communicate and exchange data — is expected to largely benefit Airtel which is the second largest service provider in the country by accessing a share of mobile money payments made through merchants as well as deepening financial inclusion.

And of course, this development won’t sit well with Safaricom, which has been hesitant to open up its mobile payments platform to rivals, that would expose its lucrative M-PESA mobile money platform to stiff competition.



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