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Business deals push up mobile transfers

Customer transactions recorded Sh446 billion in three months to June compared to Sh310 billion the previous quarter, says CA report.

There was a surge in mobile money transactions for businesses as the preferred way of making payments after operators scrapped fees on low value amounts.

There was also a major drop in payment for services offered by the government between April and June because some were unavailable as some public offices restricted access to offices, as well as many Kenyans limiting their movements to contain the spread of Covid-19.

The government, in April, directed mobile firms to scrap charges levied on mobile money transactions lower that Sh1,000. This in turn saw a 43.8 per cent increase in the amount that Kenyans paid to businesses through mobile money.

A new report by the Communications Authority of Kenya (CA) shows that in the quarter between April and June, consumer-to-business (C2B) transactions increased to Sh446.5 billion from Sh310.48 billion.

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Consumer to Government (C2G) transfers declined by 62 per cent. Over the quarter, the value of C2G transactions – which include fees paid to government for licences and permits – declined to Sh8.7 billion from Sh23.31 billion over the January to March quarter this year.

Also on the increase was the number of person to person (P2P) transactions, albeit this did not go up as much as would have been expected.

The P2P transactions went up 24.3 per cent to 559 million transactions over the quarter to June compared 449.89 billion in the January to March quarter.

The value of the P2P transactions grew 7.2 per to Sh722.55 billion from Sh674 billion the previous quarter.

“The values transacted during the period increased significantly from the previous quarter following the government’s directive on the use of cashless payment systems to curb the spread of Covid-19,” said CA in the report.

It noted that Safaricom’s M-Pesa continued to dominate the mobile money space, accounting for 98.9 per cent of all transactions.

As at June 30, mobile money subscriptions stood at 30.5 million from 29.19 million in March.

And while businesses have been shutting down in other sectors, the mobile money industry reported an increase in the number of agents by 10 per cent over to 223,184.

The measures put in place in March to contain the spread of Covid-19 affected the calling patterns among Kenyans.

The number of voice calls declines but use of text messages went up as younger Kenyans, whose preferred communication is SMS, found themselves with more free time.

Read the Original Article on The Standard