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Biometrics is another sort of key differentiator in the space for increased security and ease of sign-up. Africa is ready for digitisation, and we have already seen good traction in SA with our Mukuru Card product. Mukuru is investing in technology to support customers as they digitise in the coming years, across our footprint.

Ensuring that the core stability and functional capability brought about by the technologies and coding languages mentioned earlier is of paramount importance. We are relaunching our app and that’s been built on the Flutter framework. The app is important because it allows for content rich customer engagements.It will also enable us to ingest/scan customer documents in real-time, process card payments securely so that customers can create and pay for orders in one step as opposed to two, as well as allowing for a host of additional customer facing services and capabilities to be deployed.The core DNA of our business is making sure that it’s super simple and that somebody with a feature phone is not precluded from using the service, because that is the essence of where our customer base is at, so we want modular technological capabilities that we can use in any conditions.

The service will face stronger competition in the coming years. The Kenya Bankers Association -- representing 46 banks -- is introducing its own mobile payment platform that will allow convenient transfers between accounts at different banks, and the group hopes this will eat into M-Pesa's market share.

The system was launched by Vodafone's Safaricom mobile operator in 2007 as a simple method of texting small payments between users. Today there are 30 million users in 10 countries and a range of services including international transfers, loans, and health provision. The system processed around 6 billion transactions in 2016 at a peak rate of 529 per second.

So how does Mama Money offer their service at 5% whereas Mukuru, arguably the most popular service over the South Africa-Zimbabwe corridor, charges double this? From our experience of testing these two services, we noted a few key differences in how they operate which is likely to drive the cost differential between the two services. These differences include: · Mama Money maintain low overhead costs. Mama Money operate a single branch in Cape Town whereas Mukuru operate at least seven of their own branches nationally and they also operate through the Inter Africa branch network · Mama Money offer limited support beyond registration. In comparison, Mukuru operate a large 24 hour call centre and live chat function that supports and facilitates transfers. These support functions are no doubt very expensive to operate · Mama Money have a single partner organisation in Zimbabwe. Mama Money only have a single partner in Zimbabwe, CABS bank, whereas Mukuru have partnerships with a number of banks, retailers and mobile wallets. That said, if Mama Money’s Facebook comments are anything to go by, they may be adding more partner organisations in Zimbabwe, so this factor may soon be invalidated So while Mama Money’s competitors charge considerably higher fees, in the case of Mukuru, these higher fees are associated with some value-added benefits for the customer, for instance 24hr support on transactions for the sender and, for the recipient, a choice in how to receive the money.

Given the up-front costs of acquiring agents, it is tempting for mobile money providers to want to take short cuts and minimize the agent-to-customer ratio. However, this does not set an individual agent up for success. If Safaricom were to recruit too few agents, customers would find M-Pesa difficult to use and difficult to access.. On the other hand, if there were too many agents, many of them would not be able to generate enough business to cover the cost of managing their e-cash and cash liquidity. As a result, they would stop maintaining their electronic money float and cash balances. M-Pesa’s success lies in the fact that they grew their agent network at the same pace as their customer base, keeping transactions per agent per month steady at around 1,000 / agent / month.

According to a McKinsey report on Mobile Money, proximity of nearest agent makes a significant impact on transaction volumes. “When a cash agent is more than 15 minutes away, mobile money has relatively little appeal, and customers use it once or twice a month. But when the agent is less than 10 minutes away, usage rises to 10 times a month—and for those within 2 minutes of an agent, to 30 times a month.” Safaricom spread its agents out across Kenya so as to truly enable network effects and enable Kenyans to send e-cash to their family members and friends even if they did not live in the same geography.