Kenya telecom giant, Safaricom has disclosed a 50 percent ownership of M-Pesa. This is after the firm and South Africa’s Vodacom acquired the mobile money platform from Britain’s Vodafone for Sh2.14 billion.
In its latest annual report, Safaricom says that the two partners split the acquisition costs equally. This gives each of them a 50 percent share in the newly created joint venture M-Pesa Global Services Limited.
The annual report reads: “M-Pesa Global Services Limited is registered in Kenya. Safaricom Plc owns 50 percent of the issued share capital of the joint venture with Vodacom Group Limited owning the remaining 50 percent”.
The ownership structure gives Safaricom an equal say in the direction of the M-Pesa business, just like Vodacom. This is unlike before when the UK multinational fully owned the brand.
The statement also says that decisions by the joint venture to declare and/or pay any dividends or make any capital distribution to shareholders must have prior written consent of the existing shareholders.
Safaricom recently appointed the head of its financial services division, Sitoyo Lopokoiyit, interim CEO of the M-Pesa joint venture.
Vodacom and Vodafone own a combined 40 percent stake in Safaricom, which pioneered the M-Pesa service in the local market.
New Plans for M-Pesa services
M-Pesa has evolved from a basic mobile money transfer application into a fully-fledged financial service platform. It offers loans and savings in partnership with local banks, plus merchant payment services and is eyeing the unit trust business.
It has grown to become the largest payments platform in Africa, with 40 million users and processes over a billion transactions every month, according to Safaricom and Vodacom’s joint statement.
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M-Pesa is now available for subscribers in Kenya, Tanzania, Lesotho, the Democratic Republic of Congo, Ghana, Mozambique, and Egypt.
One of the new services is the recently launched Lipa Na M-Pesa business smartphone app dubbed M-Pesa for Business. It is currently available to the more than 170,000 merchants on the service. Essentially, the app allows business owners to access real-time statements, export statements and track their business performance on the go.
Through the app, entrepreneurs can withdraw funds from Lipa Na M-Pesa to their M-Pesa accounts, bank accounts or at an agent. In addition, business owners with a business till can now send money to other M-Pesa customers including paying wages, paying for supplies and make payments to other businesses all through the app.
Safaricom and Vodacom — which operates in South Africa and other markets in the region, including Tanzania — plan to grow the platform globally.
Vodafone, which currently owns five percent of Safaricom, will continue to earn royalties from M-Pesa.
Safaricom said the joint venture will allow the parties to consolidate M-Pesa platform developments. It would also allow improvement of operational capabilities into a single, fully converged unit.
Safaricom says the joint venture will drive the next generation of the M-Pesa platform. It also hopes to become an intelligent, cloud-based platform for the smartphone age.
