Mobile operator Vodacom has re-launched its mobile payments system, M-Pesa, to the South African market. Though M-Pesa has proven hugely successful in Kenya and neighbouring Tanzania, the service failed to take off in South Africa when it was first launched in 2010.
“When we first launched M-Pesa in 2010 we had high hopes that it would have the same kind of transformational impact seen in Kenya. We wanted to change the way South Africans handle money for the better. Each country has its own unique needs and challenges, and it has been a learning process getting to understand exactly what will and what won’t work in South Africa,” says Vodacom Group CEO, Shameel Joosub.
“We’ve taken the experience and knowledge gained from the past four years and have used this as the basis for a comprehensive redesign of M-Pesa for the South African market.”
In 2010, M-Pesa launched at 1 000 outlets around the country, but Herman Singh, managing executive for mobile commerce at Vodacom, says this proved insufficienct because, for the service to take hold, consumers need to be able access the service “where they live and work”. This time around the service is launching with more than 8 000 agents, including spaza shops and selected major retailers.
Singh says Vodacom aims to have an outlet “within 300 metres of where anyone lives” and that the company intends making M-Pesa available in 30 000 outlets by the end of the year, which will mean activating around 100 sites a day between now and year-end.
Customers load money into their M-Pesa digital wallets using vouchers like those used for loading airtime. Customers can select vouchers in R20, R50, R100 or R200 denominations. Once money is loaded it can immediately be transferred, or used for purchases or withdrawals with the new M-Pesa Visa card that Vodacom has introduced.
Registering for M-Pesa was also previously problematic because consumers had to present their mobile phone and South African ID book at a physical outlet. Users can now register themselves using their ID number and mobile phone. This basic registration allows users to transact up to R1 000 per day, or R13 000 per month. Should they require a higher limit, or wish to get a Visa card, they’ll need to present their ID at an outlet.
In order to encourage uptake, Vodacom is offering incentives to customers who sign up for and use M-Pesa. Customers purchasing a Visa card (for a once-off fee of R9.95) will receive 60 minutes of Vodacom-to-Vodacom call time, while those buying airtime through M-Pesa will get double the amount they purchase.
