Cross-border trade is emerging as an important driver to MPesa global expansion. Merchant payment and digitization of trade are opportunities that Safaricom aims to capture to grow Mpesa revenues.
The recent partnerships with international platforms will enable Mpesa to reach more customers and connect domestic traders to international markets.
International platforms such as PayPal, WeChat, AliExpress, and Western Union provide convenience to Safaricom Mpesa customers besides reducing transaction costs.
For instance, WeChat enables Mpesa users to transfer cash to over a billion active users of China’s digital payment system WeChat Pay.
On the other hand, PayPal allows Mpesa users to access over 220 million users globally. Mpesa mobile wallet accounts have been connected to 500,000 global agents representing financial services provider Western Union.
Safaricom’s share in diaspora remittances grew to 34% in FY19 from 15% two years ago because of the strategic partnerships.
Furthermore, signals of the deepened relationship between Safaricom and Vodacom would benefit the money transfer platform; from sharing resources (software development), joint ownership of Mpesa IP and brand, and recently potential sharing of costs and returns associated with the launch of operations in Ethiopia, should a license be awarded to Vodacom.
Safaricom’s 24 million subscribers would benefit from the diverse Mpesa ecosystem by sending and receiving money from international platforms.