The economics of mpesa william jack and tavneet suri nber working paper no. Mpesa is a mobile money transfer service that launched in kenya in 2007. Africas mpesa mobile phone payment system 3 this paper examines the african mobile phone based money transfer system known as mpesa. Mpesa charges will depend on the amount you are sending or withdrawing. The new mobile money transfer tax came into effect on july 1st 2018, through the 2018 finance bill. The mpesa service initially targeted the unbanked population but has now become the most popular and convenient money transfer service due to its low transfer charges and availability in all rural areas of kenya. Learn about the process and how mpesa security works. The mpesa tariffs shown include both the sending and withdrawal fees and are differentiated according to receipt by registered and nonregistered user. You cannot deposit money directly into another mpesa customers account at an agent outlet. The safaricom mpesa transfer and withdrawal charges only depends on one factor.
Mpesa rates 2019 safaricom mpesa charges and tariffs. Currently, it costs more amount to send money to an unregistered number in 2019. We examine how mpesa is used as well as its economic impacts. Our study captured community effects that occurred via direct and indirect economic effects realized by the users of mpesa and that accrued to nonusers through the presence of mpesa and users of mpesa. Mpesa is a mobile money transfer service in kenya, its one of the best online payment options.
The mpesa charges have increased by an average of 1 shilling for withdrawing, including via atms, and sending money. Safaricoms 7 scola kamau, safaricom raises mpesa tariffs as kenya slaps. Mpesa aktie safaricom mpesa rates for mpesa statement. The telecommunications firm on wednesday said users of the mobile money platform will apply for a statement once a month via their mobile phones or set up an automatic request for every 5th day of the month. This exceeds the reach of any other financial service in kenya. Safaricom to reduce lipa na mpesa charges for merchants. Icici bank and vmpl vodafone mpesa limited, a vodafone group company, jointly present mpesa a mobile money transfer service for all telecom subscribers.
Financial services for the underbanked contributed. The mpesa staff were able to garner insights and understanding that may contribute to framing policies and practice for mobile money services. Mpesa as a payments and money transfer platform was developed jointly by safaricom, a telco company, and the commercial bank of africa. Safaricom partners with mtn to spread mpesa services to. Practitioners insight mpesa a success story of digital. The contribution of mpesa to deepening financial inclusion for the poorest socioeconomic groups in kenya is significant.
However, if you buy for other networks, you will incur some costs. With the current advancement in mobile money transactions methodology, there has been a steady rise in business sales and services. Safaricom had lowered the minimum size of an mpesa transaction and had lowered the tariffs on the smallest transaction tiers. Today, over two years since its launch, mpesa has gained 7 million registered customers and has 10,000 agents spread across the country. Current safaricom mpesa charges for sending and withdrawing money though a safaricom agent, atm and mpesa tariffs when transferring cash both to registered and nonregistered mpesa users. Therefore, you will have to send the 140,000k in two batches. Bus502 mpesa research paper running head africas m.
Mpesa tariffs financial technology banking free 30day trial. As many on twitter noted and peter gakuremwangi noted on, this. Mpesa tariffs no transaction without an original id ke customer charges transaction range kshs transaction type and customer charges kshs min max transfer to mpesa users transfer to other mobile money users transfer to unregistered users withdrawal from mpesa agent 1 49 free na na na 50 100 free na na 10 101 500. Mpesa customers will get one free monthly statement of their transactions as safaricom seeks to address an increasing number of requests.
The mpesa service enables users to make financial transactions through their mobile devices. Here are the new mpesa charges for the different scenarios. Browse here for more information regarding mpesa statistics, history of mpesa, access trust deed forms and next of kin claim procedure. The core business proposition of mpesa1 there is a sense of discomfort among the financial institutions about. Lipa kwa mpesa is vodacoms merchant payments solution to digitize payments in the tanzania retail ecosystem and enable merchants and retailers collect payments seamlessly while helping customers to avoid the risks and burdens of carrying cash. The impact of mpesa in kenya, nber working paper no. Mpesa m for mobile, pesa is swahili for money is a mobile phonebased money transfer service, payments and microfinancing service, launched in 2007 by vodafone group plc and safaricom, the largest mobile network operator in kenya. Photo file safaricom agents and britains vodafone are expected to be the biggest beneficiary of. Mpesa ein alternatives finanztransaktionssystem in. Mpesa is a unique innovation that is rapidly evolving laws must be flexible in order to accommodate new changes and not confine development of new products. Posted on march 31, 2011 by ken western union formally announced today its linkup with mpesa to allow those of us in less developed countries, from an ict standpoint, to make money transfers to mpesa accounts. This service is free and you will only pay for the airtime purchased. Safaricom mpesa rates, fees, charges and tariffs for withdrawal and transfer will depend on the amount you are sending or withdrawing. Analyzing data from two waves of individual data on financial access in kenya, we find that increased.
These tools are here purely as a service to you, for educational and informational purposes only. Pursuant to the finance bill 2018 and the provisional collection of taxes and duties act, we have made the following adjustments to our mpesa tariffs, said the company in a notice. Red clients will be given priority when they call the service desk for assistance. With mpesa, you can send money to a friend, brother ou a business partner in any part of the country. For mpesa accounts that are not used for more than 150 days, a fee of tsh.
Advantages and disdvantages of m pesa money services in kenya 1 dr ruth wangui thinguri 2 veronica onjoro 3 kiprop langat wilson abstract safaricom launched mpesa in kenya in march 2007 and has since become the most famous and probably the most successful implementation of mobile money service to date. Mpesa m for mobile, pesa is swahili for money is a mobile phonebased money transfer, financing and microfinancing service, launched in 2007 by vodafone for safaricom and vodacom, the largest mobile network operators in kenya and tanzania. Mpesa was recently extended to kenyan diaspora living in the uk who are able to send money to their families in kenya using the mpesa. The new charges will not apply to those merchants using lipa na mpesa paybill, gaming merchant tariffs, and lipa na mpesa petrol station tariffs. Ignacio mas and dan radcliffepesa is a smallvalue electronic payment and storeofvalue system in k enya accessible from.
Safaricom has joined three bands into one which will now be between sh20,001 and sh35,000 and which will now cost sh19 to withdraw. For more information contact vodacom call centre by dialing 100 for free. We are here to assist you 247 with our red premium service desk dial 082111. Mpesa is a mobile phone based money transfer system in kenya which grew at a blistering pace following its inception in 2007. It has since expanded to afghanistan, south africa, india and in 2014 to romania and in 2015 to albania. Prior to mpesa, mobile phone customers had engaged in trading prepaid airtime. This is the second part of the guest post by dr ndunge kiiti of houghton college, new york and the gsma mwomen programme on the benefits and challenges of using mobile money to reduce poverty for. As for mpesa customers, many of whom were very poor, oosthuizen could not. Mpesa charges depend on the amount you are sending or withdrawing. Mpesa is also in tanzania, south africa, egypt, and afghanistan here are some similar platforms in other countries.
A good example of such a service is safaricoms mpesa, which was introduced in march 2007, in kenya. This is a revolutionary banking product from cba and vodacom that allows you to save money. You can get your mpesa statement sent to you for free via email or a printed copy for tsh. This study is intended to help fill in that gap, since sustainability of mpesa may depend on achieving communitywide impact. In which countries is the mpesa or similar system accepted. On applying for mpesa, customers get a mobile wallet issued by vmpl called vmpl wallet and also a mobile money account with icici bank. While mpesa has been touted as a savings tool for the poor, there is little evidence to suggest that the service is widely used to store value as savings 4 isaac mbiti and david m.
If for instance you would want to transact shs 100,000 via mpesa, you will need to spend shs 220 as you will have to first transfer shs 70,000 then transfer another shs 30,000 both charged at shs 110 to transfer. Do the mpesa rails contribute to financial inclusion. Safaricom, which runs the popular mobile money service mpesa, on saturday, informed its customers that starting sunday, its tariffs would go up. The transaction cost is now higher when sending and withdrawing through mpesa due to taxes. You can use your mpesa menu to buy airtime for your phone, or for someone else. A mobile banking service that allows users to store and transfer money through their mobile phones. Pesa tariffs include withdrawal fees, and are differentiated according to receipt by registered and non.
Anyone can send money in all over kenya through mpesa safaricom mpesa rates, mpesa charges and mpesa tariffs depend on the amount of money you are the mpesa withdrawal charges for agent withdrawal and atm fees are different from those applied. Pdf an analysis of mpesa use in international transactions. O16,o33,o55 abstract mobile money is a tool that allows individuals to make financial transactions using cell phone technology. The above table is for mpesa withdrawal charges in 2020.
Mpesa was launched 10 years ago in kenya and it now has over 24 million customers, 54,000 active merchants and over 114,000 mpesa agent outlets. Chapte r 20 mobile payments go viral mpesa in kenya. This paper discusses the history of mobile phone money transfer in africa prior to mpesa, the initial concept of mpesa, and how mpesa has grown how mpesa was created in 2007 by vodafone and safaricom in kenya and now offers microfinancing. Im sure that mpesa users throughout the country will roundly welcome this news. Community level economic effects of mpesa in kenya. Kenyas safaricom has partnered with mobile phone service provider mtn in a new venture that will enable its 19. Mpesa was originally introduced in kenya as an alternative way for the unbanked. Equitel is the solution to mpesas inflated tariffs. Withdrawal of amount between sh501 and sh2,500 from an mpesa agent will now cost sh28 up from sh27. Safaricom effects new mpesa transaction costs daily nation. All tariffs stipulated above are inclusive of all government taxes. Mpesa rates, mpesa tariffs, mpesa withdrawal charges, m. Whilst every effort has been made in building these calculators, we are not to be held liable for any special, incidental, indirect or consequential damages or monetary losses of any kind arising out of or in connection with the use of the tools and information derived from the web site. How does the mpesa service work and what are the risks.
Mukesh sadana, george mugweru, joyce murithi, david cracknell and graham a. Take a look at this table for the new rates of sending and withdrawing money via mpesa. Its operated by vodafone for safaricomm and vodacomm, the largest mobile operators in kenya and tanzania. Thirdly, buying credit or bundles data for a safaricom line is also free of any charges. New mpesa transaction charges take effect july 1 mobile. Mpesa has new charges, fees and tariffs starting july 2018. Until we get mpesa in the united states africommons. It has since expanded to tanzania, mozambique, drc, lesotho, ghana, egypt, afghanistan, south africa, india, romania, and albania.
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