M-Pesa: Financial Inclusion in Kenya

M-Pesa, a mobile money transfer service launched in 2007 in Kenya by telecommunications company Safaricom, allowed people to send money via mobile messaging to contacts, such as friends and family, or even to pay for goods and services, such as groceries or a taxi fare. Uptake for the service had soared, gaining 2 million users in one year of operations. By 2014, M-Pesa processed transactions amounting to almost 7% of the total national payments (NPS) throughput value and two-thirds of total NPS throughput volume. It reduced the dangerous burden of carrying cash for individuals and businesses and brought millions of financially excluded people into the formal financial system. But despite M-Pesa’s meteoric rise and the emergence of similar services, 90% of transactions in Kenya were still in cash. Competition was growing and product line extensions had disappointed, as had several international ventures. Company executives, such as Betty Mwangi, M-Pesa’s general manager, believed that there was still ample opportunity for growth. But after M-Pesa’s outstanding launch and overwhelming success, what would be the company’s encore?