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Kenyan mobile money service, M-PESA has entered a strategic partnership with global e-Commerce company, Amazon, which will see M-PESA provide global remittance services.
The United Nations estimates that the value of remittances globally will surpass $4 trillion by 2030, and M-PESA is said to be aiming to become a force in the cross-border money transfers sector.
M-PESA, which is expected to become a stand-alone operation in 2023, may be looking at the partnership to enhance is competitiveness in a crowded cross-border payments landscape.
As an independent fintech player, M-PESA will face stiff competition from established money transfer providers such as Western Union, Money Gram, World Remit, and Remitly. Additionally, emerging players like Flutterwave and ChipperCash from Nigeria, as well as Waya Money and Waya, an African-centered digital banking application based in Washington DC from Kenya.
In 2021, MPESA said it had achieved more than 50 million monthly active users (MAU) in Africa with users spanning across seven countries, rivalling MTN MoMo’s 56.8 million users.
MPESA’s declared countries of operations include:
- Kenya
- Tanzania
- Mozambique
- DRC
- Lesotho
- Ghana
- Egypt
M-PESA, which is expected to become operational in Ethiopia as well, also indicated that over 500,000 businesses transact $7 billion every month on their mobile money and digital platforms.
The partnership with Amazon is not the first of its kind as Safaricom has been utilizing these partnerships to broaden its range of services and address the issue of remittance in Africa. In 2018, the telecommunications company entered into a partnership with PayPal, enabling users to carry out withdrawals and deposits from either platform.
In 2022, Visa and Safaricom announced the launch of a virtual card service that will connect the Kenyan telecom operator’s M-PESA financial services platform with VISA’s global network of merchants and cards. The deal will enable M-PESA subscribers use the platform as a virtual card allowing them to make payments abroad when they travel and also letting them transfer cash from their VISA-linked debit cards to their M-PESA wallet even when abroad.
On the local front, M-PESA has sustained efforts to launch digital products such as Fuliza, now the leading lending service in Kenya, in partnership with local banks like Kenya Commercial Bank (KCB) and NCBA bank.
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