Barclays bank has acquired a code from Safaricom for customers to make direct payments to and from their accounts through M-Pesa’s Pay for Goods service, similar to Safaricom’s Lipa na M-pesa.
The bank looks to sign in big retailers and distributors of cigarettes, bread and soft drinks to its mobile phone based payments platform for them to have the money directly wired to their accounts. As much as the service seems competition to Safaricom’s Lipa na M-Pesa the telecommunications company is set to be the biggest winner in the deal since it will be receiving commission payment of one per cent of the value of each transaction made through the service, which amounts to billions of shillings.
Distributors will be required to open a Barclays Bank account, give a list of customers from whom they regularly get payments and these businesses will then get assigned codes. Once a listed customer makes a payment the money automatically wired into the distributor’s bank account complete with the cash amount and their pre-assigned code for easy reconciliation.
“Nowadays distributors, and the society at large, prefer cashless transactions for safety purposes as well as convenience and that is a field we are looking to play in,” said Paul Wainaina, acting head of business banking at Barclays.