Safaricom, in partnership with Google today launched the Lipa Mdogo Mdogo payment plan which will allow customers who earn a daily wage to access low-cost 4G smartphones for a deposit of KSh 1000 and a daily instalment of Ksh 20 bob. The plan aims at bringing on board more first time users on the internet.
Safaricom’s Chief Customer Officer Sylvia Mulinge says “Safaricom has brought to customers yet another first. Lipa Mdogo Mdogo is aimed at granting our customers access to opportunities on the internet.”
2G users will be able to access 4G devices through the Lipa Mdogo Mdogo financing project available through the Neon Ray Pro, currently retailing at Ksh 5,999.
The plan will ride on the company’s investment in 4G penetration, bringing more handsets to the network. In the last financial year, Safaricom invested Ksh 36 billion in network upgrades. While the 4G network is already available in all major towns, at 77% coverage, only 17% of devices in the country use the network generation. Further, according to the Communications Authority, the country still records low smartphone at 45% compared to a total mobile penetration 116%.
Speaking at the launch of the Lipa Mdogo Mdogo payment plan, Safaricom CEO Peter Ndegwa said they are targeting a million more users through the phones. Further, Ndegwa said that Safaricom would offer 80% 4G coverage within the next five years.
“We recognize that today’s mobile phone is not just a device; it is a tool for development. We are witnessing a difference in income between those with mobile internet and those without it. Together with Google’s Android, we are aiming for 1 million customers,” said the CEO.
Ndegwa also said that the company might roll out the service, the world’s first, in other countries based on its success in Kenya.
Google will provide Android devices, taking up with device manufacturers and mobile operators to drive digital economies as part of its plan to make the power of computing commonplace.
Eligibility for Lipa Mdogo Mdogo
Customers eligible for the service include those who have used Safaricom services for at least one year, using Mpesa, voice and SMS services. Moreover, users must be above the age of 18. Currently, Lipa Mdogo Mdogo targets individuals with 2G phones, looking to roll out the service to 3G mobile users later.
Eligible customers will opt-in for the service using the USSD code *544#, allowing Safaricom to check their eligibility, based on their interactions with the provider. After the users are qualified, they can pay the Ksh 1000 deposit at any Safaricom shop and continue paying the 20 bob instalment every day through the Safaricom App.
The higher purchase smartphone financing plan will cost the customer a total of Ksh 6,580. Customers who fail to pay daily instalments will get a three day grace period after which Safaricom will engage them on the default.
“We will give users a grace period of three days to catch up with their payments, and later engage them to find out why they are falling back. In case of further default, the phone will lock out the user, only allowing access to the Safaricom App for instalment payments,” Sylvia added.
Safaricom is also working on mobile phone insurance to cover theft for the new mobile devices.