Safaricom

1. Safaricom
The Mobile Money Revaluation
M-Pesa
“If the Cash is King, then the King is Dead”
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By
Wasim Khalil

2. Safaricom
 Safaricom is a leading telecommunication
operator in Kenya,
 which is 40 percent owned by Britain's Vodafone ,
started as a department of Kenya Posts &
Telecommunications Corporation, the former
monopoly operator, was launched in 1993 and
 become market leader in Kenya by provide the
lowest charge for nationwide in world,
 Safaricom also pioneered commercial mobile
money transfer globally through M-PESA,
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3. Mobile Payment
 It is also referred to as mobile Money, Mobile
Wallet, Mobile Money Transfer.
 Mobile payment is defined as “paying for goods or
services with a mobile device such as a phone,
personal digital assistant (PDA), or other such
devices.
 Allow to deposit and withdraw money , transfer
money to other users and non-users, settle bills
and pay for all sort of services as well as digital or
hard goods.
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4. M-Pesa
 M-Pesa (M for Mobile, Pesa is Swahili for money)
 is a mobile-phone based money transfer
and micro financing service.
 launched in 2007 by
Vodafone for Safaricom and Vodacom, the
largest mobile network operators in
Kenya and Tanzania.
 It has since expanded to Afghanistan, South
Africa, India and in 2014 to Eastern Europe.
 M-Pesa allows users with a national ID card or
passport to deposit, withdraw, and transfer
money easily with a mobile device. 1-4

5. M-Pesa
 The service allows users to deposit money into an
account stored on their cell phones, to send
balances using PIN-secured SMS text
messages to other users, including sellers of
goods and services, and to redeem deposits for
regular money.
 Users are charged a small fee for sending and
withdrawing money using the service.
 M-Pesa is a branchless banking service; M-Pesa
customers can deposit and withdraw money from
a network of agents that includes airtime
resellers and retail outlets acting as banking
agents 1-5

6. Market Trends
 2011
 Mobile payment users hit 160 Million users.
 Mobile payment Transactions value : $106 billions.
 2013
 Mobile payment users hit 245 Million users.
 Mobile payment Transactions value : $235 billions.
 2017
 Mobile payment users hit 450 Million users.
 Mobile payment Transactions value : $725 billions.
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7. Market Trends
 The Growing ease with which it enables people to
collect payments from customers, buy goods, pay
for services and send money to family and friends.
 Facilitating for unbanked people to access to many
services and interact with many financial services
and performing money transactions.
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8. Industry Structure
 Mobile Payment Move faster in developing
country because :
 Mobile Money can operate outside the structure
of formal financial sector.
 Mobile Money is powerful substitute for
conventional alternatives.
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9. Looking Forward
 More than 100 mobile-money deployment in
emerging market start operating.
 M-Pesa, M-Paisa, FNB, GCASH, SMART Money.
 More than half the word adults do not use
financial services.
 More than billion people in emerging and
developing markets have cellphones but not a
formal bank account.
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10. Questions Q 12-3
 Question 12-3
 Dynamism creates opportunity as well constraints. Identify
the most promising opportunities as well as constraints for
mobile money service providers in developed markets then
do the same for firms in developing markets, how they are
similar? How do they differ?
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11. Questions Q 12-3
 Answer 12-3
 Opportunities in Developed Market
Strong physical infrastructure, Sophistication of buyers and
sellers of financial services, Effectiveness of regularity for
those reasons the Mobile industry could find good
environment for growing
 Constraints in Developed Markets
Extensive Access, Diverse options, High Sophistication, far-
reaching regulations could slow down the growing of mobile
payment industry additionally to the fact that vast majority
of people in developed countries have little need for mobile
money.
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12. 1-12
Questions Q 12-3
 Answer 12-3
 Opportunities in Developed Market
 Mobile money can operate outside the structure of the
formal financial sector additionally to that Mobile money is
a powerful substitute for conventional alternative.
 Constraints in Developed Markets
Potential criminality call for vigilant, it could be used for
cleaning money

13. Questions Q 12-4
 Looking out over the next decade, forecast the likely
standards of value creation in the mobile money industry.
How would you advice a company like Deutshe bank or
Visa to configure and coordinate its value chain to prosper
in this environment? Would you advise the same to
companies like IBM, Google, or Safaricom?
 Deutshe bank or Visa(Finance company) must focus on
unbanked people and align there Strategy to serve this
category of customers.
 Technology and Communication Company have a good
opportunity to invest in Mobile money.
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14. Questions Q 12-5
 What sort of executive perspective do you see as critical to
identify and understand the opportunity of mobile money in
emerging markets? Will the same set apply to executives
working in established countries?
 It is good opportunity in Mobile Money because a billion
people in emerging Market have a cellphone but not a
formal account.
 For the established countries most of people have a formal
bank account so the opportunities is less than Emerging
market.
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15. Questions Q 12-6
 In the long run, do you anticipate a few global players
applying an integrated strategy across multi markets or
many national companies emphasizing local adaptation to
create more values in the mobile money industry? Identify
technology trends, business practices, and regulatory
conditions that support your choice.
 International consortiums are establishing to support
mobile Money for example Apple, VISA and MasterCard
they provide new services to support payment by Mobile
across multi market, and will apply the conditions applied
for visa and MasterCard the technology could use to
support national market and will support bank and un-bank
organization.
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