Safaricom, Kenya’s telecommunications giant, and the South African mobile communications company Vodacom have completed the acquisition of the M-PESA brand, along with its product development and support services, from Vodafone Group PLC through a joint venture, the companies said on Monday (April 6.)
“This is a significant milestone for Vodacom, as it will accelerate our financial services aspirations in Africa,” said Shameel Joosub, Vodacom Group CEO, in a statement. “Our joint venture will allow Vodacom and Safaricom to drive the next generation of the M-PESA platform, an intelligent, cloud-based platform for the smartphone age. It will also help us to promote greater financial inclusion and help bridge the digital divide within the communities in which we operate.”
Michael Joseph, outgoing Safaricom CEO, said he was excited that the management, support and development of the M-PESA platform have moved to Kenya, where the journey to transform the world of mobile payments began 13 years ago.
“This new partnership with Vodacom will allow us to consolidate our platform development, synchronize more closely our product roadmaps and improve our operational capabilities into a single, fully converged center of excellence,” he said in a statement.
M-PESA, which was described by the companies as the largest payments platform in Africa, has 40 million users and processes over one billion transactions every month. In addition to Kenya, its services are offered in Tanzania, Lesotho, the Democratic Republic of the Congo, Ghana, Mozambique and Egypt. According to the statement, 25 percent of all M-PESA customers have access to a smartphone.
The announcement comes on the heels of the negotiations for purchase that began last year. The move promises to accelerate the brand in Africa, the firms said. At the time, the companies said the $13.4 million would allow both companies to save in royalties paid to Vodafone. Before the acquisition, Safaricom said it paid 2 percent of its annual M-PESA revenue, while Vodafone paid 5 percent in an intellectual property fee from its M-PESA business.