Mobile banking service generating most revenue for Vodafone in Kenya

The success of Kenya’s M-Pesa mobile money service has been underlined by the revelation that the service is now the country’s single largest source of revenue for its owner, Vodafone. The service is operated by Safaricom – itself 40% owned by Vodafone - and is licensed out for a quarterly fee.

The Kenyan operator’s paid US$21 million in fees to Vodafone over fiscal year 2010 – 2011, with the licence fees for M-Pesa totalling US$15.6 million. However, this sum accounts for just 12% of the total revenue gained by Safaricom from M-Pesa in 2011, which amounted to around US$130 million.

Despite the success of the mobile money transfer service, such transactions made up only 2% of the Kenyan operator’s total revenue, totalling US$1 billion. Around 14 million – roughly 80% - of Safaricom’s customers use M-Pesa.

The service’s success in Kenya led to its launch last year in Tanzania by Vodafone-owned operator Vodacom. According to reports, Indian operator Vodafone Essar along with African operators Vodafone Egypt and Vodafone South Africa could all begin offering the service.

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