M-Pesa, Kenya’s popular mobile money platform, is taking a next step. By introducing a new debit card, it hopes to grab a piece of the $13.5 billion in annual transactions in Kenya’s card payment industry. The M-Pesa debit card will compete directly with the cards services currently offered by regular banks in the country.
The new card, launched by M-Pesa’s mother company Safaricom, is to be linked to its Lipa na M-Pesa (pay with M-Pesa) service, which enables traders and individuals to settle bills at different points of sale across the country.
With the card, Safaricom aims for high-volume, low-value transactions that are – until now – typically paid for with cash. The transaction is quick, as opposed to the current payment set-up using M-Pesa. In a typical set-up like the cashier’s till at a supermarket, a buyer is required to input the till number, the amount money due, the M-Pesa PIN and then wait for the transaction to be completed. The new M-Pesa debit card will allow consumers to pay for goods and services much quicker on the ‘tap-and-go’ basis.
According to a Quartz report, Safaricom’s step “adds fuel to its fierce competition with banks, with each side devising ways of eating into the other’s market.” In 2015, a total of 1.3 trillion Kenyan shillings ($13 billion) was transacted through electronic payments cards in Kenya with $12 billion transacted in a prior year.
Further reading on qz.com