Airtel subscribers will from this week start making payments on Safaricom’s Merchant service, Lipa na M-pesa. The tech giant is set to launch the interoperability this Friday to enable a seamless transfer of funds between the two rival networks.
“Lipa na M-Pesa will (have) interoperability between operators. It will benefit both consumers and operators,” a Top executive at Safaricom told the Business Daily.
Last month, the Central Bank of Kenya (CBK) revealed plans to launch a national payment gateway that would compel Safaricom to accept payment from rival firms such as Airtel on its Lipa na M-Pesa feature to enable seamless transactions.
Read: Safaricom Launches Promotions to Reward Business Owners Using Lipa na M-Pesa, Pochi la Biashara
Airtel’s merchant payment service, Lipa na Airtel Money is comparably less popular than Safaricom’s merchant service, a reflection of the company’s market share in the Fintech sector.
According to the CBK, lack of interconnection among telecommunications operators has hampered the rising use of mobile money at agents and merchants via platforms such as Lipa na M-Pesa.
The move also aims to curtail Safaricom’s dominance in the mobile money service and payment gateway which reportedly handled payments worth Sh970.2 in the financial year to January 2022.
It is still not clear how the service will be used or packaged for users. Lipa na M-pesa is normally free for customers except for payments at the Petrol Station. According to Safaricom’s website, business owners are charged a maximum of 0.5 percent or a maximum of Sh200 for every transaction for money collected at the till.
Read: How Safaricom is Celebrating 200k Businesses on #LipaNaMpesa
Currently, subscribers can send money across the mobile phone networks, which means they can send money from M-Pesa and have it appear in their Airtel Money wallet and vice versa.
“The emergence of a fully integrated ecosystem that is seamlessly interoperable is critical. A strong foundation has already been laid with the rollout of P2P [peer-to-peer] interoperability in 2018 and the industry engagement that culminated in the proposal for a single integrated solution with multiple functionalities (national switch),” the CBK said.
Lipa na M-Pesa facilitates payments, cash transfers, credit, insurance, savings, and investment.
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