When mobile payments and banking come to mind, one most likely thinks of headline-grabbing industry leaders such as Apple, Barclays and Visa. However, the reality is a bit different. The distinction of largest uptake of mobile payment adoption actually belongs to Kenya, and the M-Pesa payment solution.
This system was introduced by Vodafone, in partnership with Safaricom in Kenya and Vodacom in Tanzania, to offer a payment system as an alternative to banks. M-Pesa operates as a banking solution within a telecom offering, whereby mobile users also have bank accounts linked to their numbers. Using this service, users can deposit and withdraw currencies at physical M-Pesa telecom service locations as well as conduct mobile payments to other users through SMS. According to M-Pesa, by mid-2014, the firm had over 12 million users in Kenya. The mobile banking and payment product has also helped raise the percentage of Kenyans with access to financial services from around 40% in 2009 to 67% in 2014.
Announcing what it believes will help spur new innovation in the product, Safaricom has unveiled M-Pesa API and a 3rd party development forum. The API is part of M-Pesa’s second generation platform- dubbed G2. The launch of the API occurs as Safaricom has stated its intentions to increase the M-Pesa payment platform among businesses. As such, features being promoted by M-Pesa for its API are solutions for consumer to business (C2B), business to consumer (B2C) and businesses to business (B2B) payments.
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What does opening up M-PESA API mean? Easy integration of 3rd parties onto MPESA & the ability to do more local innovations. #MPESADevForum
— Safaricom Limited (@SafaricomLtd) September 4, 2015
Examples promoted by Safaricom are automated receipt processing, payment disbursements and payment reversals. With regards to receipt processing, one potential feature is the ability for merchants to send clients a message such as ‘are you sure you want to proceed with the payment transfer’, limiting potential mistakes when bill payments are sent to the wrong account.
On the news, Safaricom stated: “We will be organizing workshops to engage our developer community and exchange ideas on the available APIs as well as any gaps we may need to address. We will also be sharing documentation to guide developers manage these integrations seamlessly, delivering on our promise of nurturing innovation through open systems.”