The M-Pesa mobile payment and money transfer service, which was launched five years ago in Kenya by the Safaricom network, has been joined by a savings and loan facility called M-Shwari. The new facility has been set up by Vodafone, Safaricom and the Commercial Bank of Africa (CBA).
Safaricom customers can sign up for an M-Shwari savings account through the M-Pesa menu on their phone without completing any forms or visiting a bank. It’s also possible to apply for a loan in the same way, with CBA determining the customer’s eligibility based on their M-Pesa transactions and savings history. The loan payment is sent directly to the customer’s M-Pesa account.
Michael Joseph, Director for M-Pesa within the Vodafone Group, said “M-Shwari is a transformational service: saving is no longer the privilege of an elite; all Kenyans can now save, even the smallest amounts and at their own pace. M-Shwari creates a safe environment for customers to borrow small amounts and links the amounts of credit available to the ability to save. Through their M-Shwari savings account, M-Pesa customers are empowered to manage their financial lives.”
“Working with CBA meant having access to banking expertise in savings and loans and allowing M-Pesa customers to earn interest from their savings. This is an important step forward for millions of M-Pesa customers in Kenya. Based on our experience in Kenya, we will look to take this innovation to other markets.”
Vodafone has a 40% stake in Safaricom.