Kenya’s Safaricom, owner of mobile money service M-PESA and Chinese e-commerce giant Alibaba have sealed a partnership deal that will ease the flow of transactions for online shoppers in Kenya. As announced on Tuesday, March 12, Alibaba’s Aliexpress will allow Kenyan shoppers to buy goods on the site using M-Pesa mobile payment service.
Accordingly, Ant Financial, an affiliate of Alibaba that runs the portal’s payment services, will offer M-Pesa as one of the payment options with transactions denominated in Kenyan shillings. M-Pesa users will, therefore, be able to shop the site without a credit card. Once customers select M-Pesa, they can then key in their mobile numbers, and use their PIN to complete a transaction. More Kenyans will be encouraged to shop online thanks to this new development,
In a statement, Safaricom said the partnership is part of its vision to expand to foreign markets. It seeks to connect Kenyans to more business opportunities by enabling them to seamlessly source, purchase and import goods from the world’s leading manufacturers. More than 21 million customers will now be able to use M-Pesa on the Aliexpress platform.
“The move especially targets micro-traders in the country who source goods and other supplies from manufacturers in China,” ” said Sylvia Mulinge, chief customer officer at Safaricom.
Aliexpress is a leading online shopping portal for businesses and currently accounts for 46 percent of Kenya’s total international online purchases, competing with eBay and Amazon. This deal will boost Kenya’s participation in the International e-commerce marketplace, and at the same time spur economic growth.
More specifically, the deal is another opportunity for Safaricom to boost its revenue through its M-Pesa mobile money service, which accounts for 30 percent of the company’s revenue. According to data accumulated by communication authorities, e-commerce accounted for 76 percent of total mobile money transfers at a value of Sh1.55 trillion between July and September last year. This was through 526.9 million transactions. Additionally, several Kenyans’s will benefit from better and improved services as they lean towards online shopping.
Currently, the market leader in Kenya with 65 percent of cellphone users – 30-million subscribers, Safaricom has been on a drive to meet the demands of Kenya’s underserved market. Recognising the problem of access to financial services, the company launched M-Pesa to offer Kenyans without bank accounts a network to transfer money via mobile phones. The service has now grown to offer a range of payment services, loans and savings to more than 21 million people in Kenya.
In November 2018 the company signed a deal with Western Union to allow M-Pesa users to send money around the world using their cellphones.
This new service is already live on the Aliexpress app and will be available on its website in the coming week.