Back in May 2017, we reported that mobile money interoperability would be available to consumers within three months but that did not happen. Months later and finally we have something substantial. Joe Mucheru, ICT Cabinet Secretary announced that cross-network mobile money transfers was finally going live with the launch of a pilot program as from Monday 22, 2018 between Airtel and Safaricom staff members.
For those not in the know, mobile money interoperability will mean that Airtel money users can receive money from M-Pesa users and vice versa. At the moment, if an Airtel Money user send money to an M-Pesa user, the M-Pesa user will receive a text message on the transaction but the balance will not reflect on his M-Pesa statement, the M-pesa user will have to go to an Airtel Money agent to withdraw the cash, however, with interoperability, it means that if the Airtel Money user sends money to an M-pesa user, the M-Pesa user will actually receive the money on their account and can transact with it or withdraw from an M-Pesa agent.
The calls for interoperability started echoing after Analysys Mason – an independent international consultant, recommended that M-Pesa be detached from Safaricom, if the later’s perceived dominance is to be tamed. Safaricom was against the idea of detaching their product but agreed to initiate interoperability to increase competitiveness in the telco sector.
As of now, only Safaricom and Airtel have an agreement on the mobile money interoperability, Telkom is said to join in later on after they launch their mobile money platform. The pilot is set to run for one month, after which, the service will go to market after the approval of Communications Authority of Kenya and the Central Bank of Kenya.
There are no pricing details yet on how much it will cost one to send money from one network to the other but word has it that the two telcos have agreed not to charge each other inter-change fees. Business Daily reports that they will maintain pre-funded accounts from which they will draw to settle cross-network transactions.
According to Mr Joe Mucheru, mobile money interoperability will bring back competitiveness in the sector, “One of the reasons we need interoperability is to make sure that people are not limited by a closed network, you should send money to anyone on any network and receive from anyone,” he said.
Countries like Tanzania and Rwanda have already implemented mobile money interoperability and so far indication is that this has worked well for them.