Vodafone’s popular money service has finally changed hands
Last year, Vodafone struck a deal to sell its financial service platform M-Pesa to a joint venture from Vodacom and Safaricom. The financial details of the deal remain unclear, but it has been suggested by Safaricom that the platform is worth around $13 million.
Now, the deal has been completed, leaving Safaricom and Vodacom in joint control of the money transferral and financing service.
M-Pesa currently has 40 million customers working in Africa, with Vodacom and Safaricom hoping to expand this continental customer base.
“This is a significant milestone for Vodacom as it will accelerate our financial services aspirations in Africa,” said Shameel Joosub, Vodacom Group CEO. “Our joint venture will allow Vodacom and Safaricom to drive the next generation of the M-PESA platform – an intelligent, cloud-based platform for the smartphone age. It will also help us to promote greater financial inclusion and help bridge the digital divide within the communities in which we operate.”
Last December, Vodafone was looking to expand the M-Pesa service throughout Africa, partially in an effort to unlock the financial potential of millions of ‘unbanked’ people on the continent. “I believe we can turn it into Africa’s largest unbanked bank,” Nick Read, Vodafone’s CEO, said at the time, and it seems Safricom and Vodacom will be continuing this broader strategy.
Breaking into the Ethiopian market was one such goal, which was estimated in December to be worth around $1.5 billion. However, moving M-Pesa into Ethiopia will have to remain a pipe dream, as the east African nation has on Thursday made a ruling that only locally-owned non-financial institutions may offer mobile money services.
While Ethiopia is slowly opening its doors to foreign telecoms investment, for now mobile financial services like M-Pesa will have to wait.
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