M-Pesa, Safaricom’s renowned mobile money remittance service, has formed a new strategic partnership with Amazon, the prominent American e-commerce company, to offer worldwide remittance services.
In May 2021, Safaricom suggested a possible partnership to increase its global presence and recover from its first profit decline in ten years.
The UN has forecasted that global remittances will surpass USD 4 trillion by 2030, and M-PESA intends to broaden its reach beyond Africa through its recent collaboration with Amazon, which aims to facilitate two-way flows.
These developments coincide with M-PESA’s impending separation from its parent company, Safaricom, and the establishment of its independent operations. This move is expected to increase M-PESA’s influence in the financial market, as it has already established a strong presence in numerous global markets.
The fintech company intends to expand its business across Europe and differentiate itself from traditional banks by partnering with Amazon and potentially gaining support from Vodafone and Vodacom, Safaricom’s global shareholders, to penetrate the strong European markets.
In the global arena, M-Pesa faces competition from established companies like Western Union, Money Gram, World Remit, and Remitly, as well as newer players such as Flutterwave and ChipperCash from Nigeria and Waya Money, an African-focused digital banking app based in Washington DC.
Safaricom has been utilizing such partnerships to broaden its offerings and improve remittance services for the continent. In 2018, the telecommunications company collaborated with PayPal, enabling users to deposit and withdraw funds from either platform.
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