Safaricom CEO Bob Collymore broke the good news to merchants during his address at the FT Africa Payments Innovation Summit held yesterday in Nairobi. The telecom announced planned tariff price cut by 50% on its M-Pesa’s Lipa Na M-Pesa services, a mobile money payment solution that allow merchants to receive payments via M-Pesa.
Safaricom will, as from next week, charge a maximum of 0.5% on the transaction amount, down from the previous 1% under the new Lipa Na M-Pesa tariff. Additionally, merchants will be charged at a flat rate of Ksh. 200 for payments over Ksh.40,000.
“We trust that this development will boost the attractiveness of the Lipa Na M-Pesa platform to more small and medium enterprises while making the service more affordable compared to other alternatives in the market, said Collymore.
Collymore went further to reveal that M-Pesa recently launched Kadogo tariff will now be expanded to include Buy Goods option under the Lipa Na M-Pesa service. This development will mean merchants will receive payments below Ksh. 200 at completely no cost.
Safaricom has announced that it has improved the speed of processing money transfer service for Merchants’ Lipa Na M-Pesa wallets to their bank accounts. Previously, it took as long as 28 hours, but now with the enrollment of up to 23 participating banks, Safaricom say the transfer will be done instantly.
SMEs are the biggest gainers
Safaricom’s announcements at yesterday’s #FTAfricaPayments summit reveal small and medium businesses as the biggest gainers. In particular, businesses like matatus (public transport operators), hawkers, kiosks, bodabodas (motorbike taxis), small eateries and the likes.
The move is also set to make a general ease of doing business for Kenya’s economy in general given the SMEs employs as much as 80% of Kenyans through the informal sector. The Lipa Na M-Pesa changes will be effective from the first week of April, while M-Pesa PayBill, Lipa Na M-Pesa petrol station tariff, and Gaming merchant tariffs will not be affected.
Use M-Pesa through a mobile app
Safaricom also announced the porting of M-Pesa functionalities into the MySafaricom app, effectively enabling users to conduct M-Pesa transactions. A much-awaited option, as for its decade run, M-Pesa has only been accessible via the SIM toolkit on a USSD-based service. Now, users can use it on their Android and iOS devices.
Some of the benefits of using M-Pesa on the app include the ability to input the intended payee by selecting a contact from the phonebook contact list through the app. On the SIM toolkit app, the fail-safe feature has limited capability on smartphones; since the SIM phonebook may not necessarily the default contact list on smartphones. It requires an additional USSD-based service, Hakikisha, to confirm the intended payee.
The app will now also enable M-Pesa users to confirm names of agents and businesses before they can send money via Lipa Na M-Pesa services.