Hands in the Cookie Jar


The world’s largest payment company Visa is set to launch a new mobile payment service called mVisa in Kenya, which might set a challenge to Africa’s first and successful mobile money system Mpesa. mVisa is aiming to cash in on less charges per consumers when they make payments to merchants to “as low as zero”, mVisa claims it will charge its consumer only to convert money received for cash since consumers will be able to withdraw it from an ATM using their expanded VISA network. Although at first sight, the VISA name is a major threat, nonetheless Safaricom’s Mpesa – Africa’s longest running mobile money system has been marvelled a model of mobile innovation and m-payments globally.


Visa partnered with four banks in Kenya to launch their mobile money system which includes Kenya Commercial Bank, Kenya’s largest bank by assets, and two other prominent institutions, the Co-operative Bank and NIC, it also hopes to sign up another eight banks in the next year and expand into neighbouring Tanzania, Uganda and Rwanda, which all have well developed mobile money markets, by end of year. mVisa expects to reduce costs of remittance from African diaspora customers overseas and for local businesses, it also aims to help banks build up customer profiles to boost provision of in-house services such as loan, bankasurance and so on. Visa’s primary goal is to enable businesses and individuals to make digital payments directly from the bank account and on a system that is interoperable between banks and mobile network.

M-Pesa Local Footprint

Safaricom’s Mpesa offers payments and transfers of money over a mobile phone in Kenya, a country where most people lack bank accounts and are generally not too savvy with financial products attributing to the main reasons for Mpesa’s major success in Kenya. M stands for Mobile (everyone has at least a simple 2G mobile phone) and Pesa stands for money in Swahili the local language – Mpesa is a product that can be related to by the local majority easily, all the “unbanked” become bank because of their access to a simple mobile phone. Mobile money in Africa has fast attracted the unbanked, a large market – which is mostly scattered in spatial areas. Banks have failed to capture this market owing largely to rigorous background checks which are often unnecessary for such a market with very little paper-trail.

Telecoms and their Massive Base

Telecoms such as Safaricom in Kenya have geared themselves for a future where they are de facto hybrid financial services companies and can offer financial services with ease to a number of people synonymously. M-Pesa’s success made relevance for market cases such as Zimbabwe in 2012, Econet Wireless – a telecoms company, pioneered EcoCash a mobile money solution as good as M-Pesa. The vast subscriber numbers Econet has made EcoCash an overnight sensation moving almost $2billion+ in the first 6 months. Telecoms offering mobile money and mobile financial services have fast adapted to forming notable payments clearing partnerships expanding their reach especially in providing debit cards. Econet’s – EcoCash partnered with MasterCard and M-Pesa has a standing agreement with Visa, can you imagine.

mVisa is a fast realisation of how mobile money has changed the emerging world, telecoms are guarding that cookie jar well, in most cases gate-keeping their mobile infrastructure charging premium access rates to anyone who “comes hands in the cookie jar”. So Visa might not be much of a challenge to M-Pesa in Kenya and the whole East African region after all, it might just be that abusive relationship to endure.

Positivity Global (Africa)