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Will WhatsApp Pay knock out M-Pesa?

By John Walubengo

When it comes to mobile payments, Safaricom’s M-Pesa rules not just in Kenya, but also regionally and globally.

The amount of M-Pesa transactions every quarter is quite staggering. Let us take a look from the latest Communication Authority Statistics.

Some 28 million M-Pesa subscribers exchanged over Sh686 billion between them over the last three months. They also bought goods worth Sh370 billion using M-Pesa services.

Merchants and their banks exchanged Sh860 billion between them during the period under review.  These amounts in any currency are mind-boggling and keep increasing every quarter.

Mobile money service in Kenya is a cases study in several top notch university across Europe and America and now Facebook has introduced payment facilities on its not-so-recently-acquired WhatsApp messaging system.

Using your regular WhatsApp messaging system, you can send money to anyone on your contact list.

This system has been working in India over the last one year and was recently extended to Brazil and many analysts believe, Africa, or Kenya in particular, could be the next destination for WhatsApp pay.

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When WhatsApp Pay finally lands in Kenya, would that be the competition that M-Pesa has been lacking all these years? Would this be the beginning of the end for M-Pesa?


Whereas a WhatsApp money transfer system seems as easy, if not better to execute than an M-Pesa payment, its front-end and back-end design requirements places it in a totally different target group.

To begin with, WhatsApp only works on internet-enabled smart phones while M-Pesa can works on non-internet, dumb phones commonly known as ‘mulika-mwizi’.

In other words, WhatsApp money transfer would not offer any completion to millions of M-Pesa subscribers who have no access to either or both the internet and a smart phone.


Another point is that WhatsApp money transfer is actually not really a new concept.  Over one billion Chinese users have been using a similar service on their messaging app called WeChat over the last ten years.

Why hasn’t WeChat invaded Kenya and taken away M-Pesa customers?

This brings us to the second point – the back-end design requirements.
WeChat Pay and WhatsApp pay require either credit card or debit card integration at their back-end while M-Pesa does not. Put differently, you will need a bank account to effect WhatsApp pay transaction.

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According to Central Bank records, less than 30 per cent of Kenyans hold a traditional bank account and so that tells you what target group the entry of WhatsApp pay would be target.

Of these 30 per cent of Kenyans with bank account, most of them have already integrated their mobile money service to their bank account and may not be interested in moving to WhatsApp pay – given that what it is proposing to do, they already can do.

Clearly, the entry of WhatsApp money transfer service in Kenya poses little or no threat to M-Pesa mobile money service in Kenya.

It may however provide some competition in the diaspora money remittance where Kenyans abroad could use it to send money home but even then M-Pesa has the same option for a wide selection of countries abroad.

It looks like the only thing that would provide good competition to M-Pesa is probably a totally different service from Safaricom itself.

I have been watching the growth of Safaricom Bonga Point ecosystem and wondering if its design structure is a foundation for something bigger going forward.

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The recent move by Safaricom to move Bonga Points out of its closed network of Safaricom shops and into the wider domains that ties in retailers and other merchants has me thinking this is not the beginning of a token-economy.

A token-economy has its genesis in block chain technologies with all its futuristic promises.  A block chain based financial services is the only solid competition that can take on M-Pesa.

It looks like it is only Safaricom that is trying to disrupt its own flagship product M-Pesa.

Mr Walubengo is a lecturer at Multimedia University of Kenya, Faculty of Computing and IT. Email:, Twitter: @Jwalu

About Whispers from the North

Whispers from the North is an online platform that appreciates the ecological, cultural and socio-economic diversities of Northern Kenya. We also acknowledge that the lives of the communities of northern Kenya has been shaped by a number of intrinsic and extrinsic factors which have led to complex challenge that calls for a multifaceted approach.

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